Bond Market Commentary

Over in bond land, Treasury yields are mostly higher before the opening bell Friday ahead of today’s economic releases, including consumer sentiment and consumer credit data. As of 6:56 AM ET, the yield on the 10-year note is rising one basis point (0.01%) to 4.09%, while the 30-year bond yield is also increasing one basis point (0.01%) to 4.69%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is unchanged at 3.56%.

Treasury yields were lower on Thursday as the Challenger Report showed U.S.-based employers announced more than 150,000 job cuts in October, the most for the month in over 20 years. The yield on the 10-year note was down eight basis points (0.08%) to 4.08%, while the 30-year bond yield fell six basis points (0.06%) to 4.68%. The yield on the two-year note decreased seven basis points (0.07%) to 3.56%. As of end of day Thursday (November 6), futures markets are pricing in 17 basis points (0.17%) worth of rate cuts at the Federal Reserve's (Fed’s) upcoming December meeting, with a cumulative 85 basis points (0.85%) worth of rate cuts by year-end 2026 and a cumulative 74 basis points (0.74%) worth of rate cuts by year-end 2027.

On the data front, the University of Michigan’s preliminary November reading of consumer sentiment is forecasted to come in at 53.0, lower than the prior month’s 53.6. The one-year and five- to ten-year inflation expectations for November from the University of Michigan are expected to come in at 4.6% and 3.8%, respectively, compared to the prior month’s 4.6% and 3.9%, respectively. The New York Fed will release their October Survey of Consumer Expectations, including a measure of inflation expectations. Consumer credit is expected to have expanded by $10.23 billion in September, significantly more than the prior month’s increase of $0.36 billion. The October jobs report scheduled for release today will be delayed as the government shutdown continues.

In the central bank space, Fed Vice Chair Philip Jefferson, Fed Governor Stephen Miran, and New York Fed President John Williams are scheduled to speak today.

Mortgage rates were higher in the latest week. For the week ending November 6, the average 30-year fixed mortgage rate was up five basis points (0.05%) to 6.22%, versus 6.79% a year ago. The 15-year fixed mortgage rate increased nine basis points (0.09%) to 5.50%, versus 6.00% a year ago.

The Bloomberg 30-day visible supply fell $1.162 billion to $10.721 billion on Thursday, below the 12-month average of $13.722 billion.

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