September 9, 2024
Over in bond land, Treasury yields are higher before the opening bell Monday ahead of July’s consumer credit data. Investors are looking forward to August’s Consumer Price Index (CPI) and Producer Price Index (PPI) data due later this week. As of 6:48 AM ET, the yield on the 10-year note is rising four basis points (0.04%) to 3.75%, while the 30-year bond yield is also increasing four basis points (0.04%) to 4.06%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is up five basis points (0.05%) to 3.70%.
Treasury yields were mostly lower on Friday, following the August jobs report, which indicated a softening labor market and raised fears of an economic slowdown. Payrolls growth came in weaker than expected and the prior two months of data were revised downward, though the unemployment rate fell slightly. The yield on the 10-year note was down two basis points (0.02%) to 3.71%, while the 30-year bond yield was unchanged at 4.02%. The yield on the two-year note decreased nine basis points (0.09%) to 3.65%.
On the data front Friday, non-farm payrolls increased by 142,000 month-over-month (MoM) in August, higher than the prior month’s revised increase of 89,000, while August’s manufacturing payrolls decreased by 24,000 MoM versus the prior month’s revised increase of 6,000. Meanwhile, private payrolls increased by 118,000 MoM versus the prior month’s revised increase of 74,000. The unemployment rate registered at 4.2% for August, down from the prior month’s 4.3%, while August’s labor force participation rate was 62.7%, similar to the prior month’s reading. August’s average hourly earnings increased 0.4% MoM and 3.8% year-over-year (YoY), up from the prior month’s increase of 0.2% and 3.9%, respectively.
In the auction space, the U.S. Treasury is set to issue $76 billion in 13-week bills and $70 billion in 26-week bills.
Medium-term mortgage rates were lower in the latest week. For the week ending September 5, the average 30-year fixed mortgage rate was flat at 6.35%. The 15-year fixed mortgage rate decreased four basis points (0.04%) to 5.47%, versus 6.52% a year ago.
Municipal Market Commentary
The Bloomberg 30-day visible supply fell $4.2 billion to $16.8 billion on Friday, above the 12-month average of $10.344 billion.
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