February 6, 2025
Over in bond land, Treasury yields are mostly higher before the opening bell Thursday ahead of today’s economic releases, including data on jobless claims, continuing claims, and nonfarm productivity growth. As of 6:47 AM ET, the yield on the 10-year note is rising one basis point (0.01%) to 4.43%, while the 30-year bond yield is unchanged at 4.64%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is up one basis point (0.01%) to 4.20%.
Treasury yields were lower on Wednesday as the Institute for Supply Management’s services purchasing managers’ index and the prices paid component came in lower than expected. The ADP Employment Change Report showed private nonfarm payroll gains for January exceeded expectations. The U.S. trade deficit widened more than expected. The yield on the 10-year note was down nine basis points (0.09%) to 4.42%, while the 30-year bond yield fell 11 basis points (0.11%) to 4.64%. The yield on the two-year note decreased two basis points (0.02%) to 4.19%.
On the data front, initial jobless claims for the week ending February 1 are expected to come in at 213,000, higher than the prior week’s 207,000. Continuing claims are expected to rise slightly to 1.87 million for the week ending January 25 from the prior week’s 1.86 million. The preliminary fourth-quarter nonfarm productivity growth is expected to come in at 1.2% quarter-over-quarter, versus the prior month’s increase of 2.2%, while unit labor costs are forecasted to have increased at an annualized 3.4% pace, up from the prior print of 0.8%. The Challenger Report on job cuts for January is expected to be released today, with December having shown a 11.4% year-over-year increase.
In the auction space, the U.S. Treasury is set to issue $95 billion in four-week bills and $90 billion in eight-week bills.
In the central bank space, Federal Reserve (Fed) Governor Christopher Waller and Dallas Fed President Lorie Logan are scheduled to speak today.
Municipal Market Commentary
The Bloomberg 30-day visible supply rose $806 million to $13.700 billion on Wednesday, compared to the 12-month average of $11.796 billion.
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