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CPI Helped Bonds Avoid Losing Ground
CPI Helped Bonds Avoid Losing Ground
Bonds began the day in slightly weaker territory and managed to flip into slightly stronger territory after the CPI data. Core monthly CPI printed at 0.2, but was rounded down from 0.24. In other words, it wasn't as big of a beat as the "0.2 vs 0.3" result suggested. The notion of inflation being "lower but still elevated" contributed to the tepid response. As for MBS, they were in positive territory all day even though charts made them look weaker due to monthly settlement. Wednesday morning brings November's retail sales data and Producer Price Index (PPI). Neither are as heavy hitting as CPI, but they could move the needle of they fall far from forecast.
Stronger after CPI data. MBS up just over a quarter point and 10yr down 1.6bps at 4.16
Choppy after initial rally but still slightly stronger. MBS up 5 ticks (.16) and 10yr down half a bp at 4.173
30yr auction 4.825 vs 4.833 f'cast. Bid to cover 2.42 vs 2.38 avg. No major reaction. 10yr down 1.1bps at 4.167 and MBS off weakest levels, up 5 ticks (.16) on the day.
10yr yields down 0.3bps at 4.175 and MBS up 5 ticks (.16).
CPI Helped Bonds Avoid Losing Ground
| Time | Event | Period | Actual | Forecast | Prior |
|---|---|---|---|---|---|
| Tuesday, Jan 13 | |||||
| 12:00AM | Roll Date - UMBS 30YR | ||||
| 6:00AM | Dec NFIB Business Optimism Index | Dec | 99.5 | 99.5 | 99.0 |
| 8:15AM | ADP Employment Change Weekly | 11.75K | 11.5K | ||
| 8:30AM | Dec y/y Headline CPI (%) | Dec | 2.7% | 2.7% | 2.7% |
| 8:30AM | Dec m/m Headline CPI (%) | Dec | 0.3% | 0.3% | |
| 8:30AM | Dec y/y CORE CPI (%) | Dec | 2.6% | 2.7% | 2.6% |
| 8:30AM | Dec m/m CORE CPI (%) | Dec | 0.2% | 0.3% | |
| 10:00AM | Jan IBD economic optimism | Jan | 47.2 | 48.2 | 47.9 |
| 1:00PM | 30-Yr Bond Auction (bl) | 22 | |||
| 1:00PM | 30-Year Bond Auction | 4.825% | 4.773% | ||
| 2:00PM | Dec Federal budget (bl) | Dec | $-145B | $-150B | $-173B |
| Wednesday, Jan 14 | |||||
| 7:00AM | Jan/09 MBA Refi Index | Jan/09 | 937 | ||
| 7:00AM | Jan/09 MBA Purchase Index | Jan/09 | 159.3 | ||
| 7:00AM | Jan/09 Mortgage Market Index | Jan/09 | 270.8 | ||
| 8:30AM | Nov PPI YoY | Nov | 2.7% | ||
| 8:30AM | Nov Core Producer Prices MM (%) | Nov | 0.2% | ||
| 8:30AM | Nov Core Producer Prices YY (%) | Nov | 2.7% | ||
| 8:30AM | Nov Producer Prices (%) | Nov | 0.3% | ||
| 8:30AM | Nov Retail Sales (%) | Nov | 0.4% | 0% | |
| 8:30AM | Nov Retail Sales Control Group MoM | Nov | 0.4% | 0.8% | |
| 8:30AM | Oct PPI YoY | Oct | 2.7% | ||
| 8:30AM | Oct Core Producer Prices MM (%) | Oct | 0.1% | ||
| 8:30AM | Oct Producer Prices (%) | Oct | 0.3% | ||
| 10:00AM | Oct Business Inventories (% ) | Oct | 0.2% | 0.2% | |
| 10:00AM | Dec Existing home sales (ml) | Dec | 4.2M | 4.13M | |
| 10:00AM | Dec Exist. home sales % chg (%) | Dec | 0.5% | ||
| 10:30AM | Jan/09 Crude Oil Inventory (ml) | Jan/09 | -2.2M | -3.831M | |
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