Treasuries on the Long End of the Curve
Posted in T-Bond Futures, derivatives on February 3rd, 2009 by Commodity Trader – Comments Off
Indecisive equities and even less certainty in Washington aided a short covering bid in Treasuries. The 30-year bond and the 10-year note enjoyed a bulk of the buying while the short end of the yield curve dragged a bit. Many analysts attributed the buying to a flight to quality bid, but in my opinion, it was likely driven by technical short covering. With today's gains, the yield on the March T-Bond is nearing 3.5% and the note slipped to about 2.75%.
Yesterday's weak data was relatively bond friendly. The ISM manufacturing index came in at 35.6, dismal but better than the expected 32. Likewise, personal income shrunk at a slightly smaller pace that most were looking for, but a negative number is far from promising.