Turning point in jobs?

August 7, 2009

Sure they’re still cutting jobs, by nonfarm payrolls are shrinking at slower pace, down only 247K in July, and the unemployment rate actually fell to 9.4% from 9.5%. With other data showing a tentative turning point in housing and manufacturing moving toward expansion, this is starting to feel like the real deal.

Just another record amount of Treasurys

August 5, 2009

I’m just getting a chance to look at the Treasury’s quarterly refunding announcement now, and no surprise here. It’s a record amount at $75 billion that will start to hit the market next week. All the details are here. Its decision to increase TIPs issuance also comes as no surprise after the Wall Street Journal flagged it here.

Running short on ammunition at the Fed?

July 15, 2009

Barring another serious economic stumble, it seems that the Fed is not going to offer much more credit easing than already planned. The minutes of the June meeting of the FOMC suggested a solid resistance to stepping up purchases of either mortgage backed securities or Treasury bonds.

Markets knocking the stuffing out of the optimists

July 8, 2009

Treasurys are up after a stellar auction of $19 billion reopened 10-year notes, stocks are floundering as investors worry about the economy and earnings season. More and more it feels like the pessimists have decisively turned the tide.

Global market cross-currents, Fed in focus

June 22, 2009

With the big event for the week – the outcome of the Federal Reserve’s Federal Open Market Committee – not due until Wednesday, global markets are left to focus on number of cross currents that are weighing on the stocks and oil and bolstering government bonds and the dollar.

Here we go again…Treasurys, mortgages go wild

June 18, 2009

Mix up a little supply, some better-than-expected jobs data and mortgage-related hedging and we’re heading back to where we were last week. Let the volatile times roll on. The 10-year Treasury yield is off more than a point to yield 3.84% – still well below the 4% mark that had investors in an uproar last week, but it serves as a reminder of just how fast this market can move.

Alternative to the dollar? Not so fast

June 15, 2009

It’s hard to get away from the steady drumbeat of comments calling for diversification away from the dollar. On Tuesday, they’ll be plenty of opportunity for more as Brazil, Russia, India and China – the so-called BRIC nations – meet in Yekaterinburg, Russia for their first official summit. A top Kremlin official, however, said discussing a new reserve currency will not be on the agenda. Russia and China policy makers in particular have called for an alternative to the greenback, not surprising given their sizable holdings of dollar-denominated assets.

Key support in Treasurys holding

June 11, 2009

Despite momentum toward higher yields, the key support level of 4% on the 10-year Treasury note is still holding after two attempts to break through. A breach of that level could ignite another round of selling with a potential added push from mortgage investors who need to shed long-term securities like Treasurys to hedge their holdings in a rising rate environment. 10-year currently around 3.95%, down slightly from the 3.99% yield paid when the note was reopened Wednesday.

Treasury yields all the rage

June 11, 2009

A plethora of articles are circulating this morning as the handwringing intensifies whether the rise in U.S. Treasury yields – the world’s debt benchmark – will kill the green shoots of an economic recovery.  Wall Street Journal weighs in here and the FT here and here. All eyes will be on today’s $11 billion reopening of the 30-year bond to see if the hammering continues.  Auction results due out around 1 pm and can be found here.

Supply matters in Treasurys

June 10, 2009

If there was any question, Wednesday’s auction of $19 billion Treasury 10-year notes shows that supply matters. The reopened notes priced with a yield of 3.99%, up steeply from the 3.19% yield on the notes issued just one month before.