Bond Market Commentary

Over in bond land, Treasury yields are lower before the opening bell Tuesday as markets evaluate the latest Iran war developments and ahead of today’s April Job Openings and Labor Turnover Survey (JOLTS) release. As of 6:57 AM ET, the yield on the 10-year note is decreasing two basis points (0.02%) to 4.43%, while the 30-year bond yield is also falling two basis points (0.02%) to 4.95%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is down two basis points (0.02%) to 4.01%. 

Treasury yields were mostly higher on Monday as the Institute for Supply Management’s May manufacturing purchasing managers’ index rose more than expected to 54.0, while its prices paid component unexpectedly declined to 82.1. Meanwhile, April’s construction spending showed a greater-than-expected increase of 0.4% month-over-month. The yield on the 10-year note was up one basis point (0.01%) to 4.45%, while the 30-year bond yield was unchanged at 4.97%. The yield on the two-year note increased three basis points (0.03%) to 4.03%.

On the data front, the April JOLTS is expected to show job openings holding steady at 6.87 million. Meanwhile, May’s vehicle sales are expected to have been at an annualized 16.00 million pace.

In the auction space, the U.S. Treasury is set to issue $75 billion in six-week bills.

In the central bank space, Federal Reserve (Fed) Bank of Chicago President Austan Goolsbee, Cleveland Fed President Beth Hammack, and Minneapolis Fed President Neel Kashkari are scheduled to speak today.

The Bloomberg 30-day visible supply rose $2.456 billion to $21.550 billion on Monday, above the 12-month average of $13.886 billion.

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