Bond Market Commentary

Over in bond land, Treasury yields are mixed before the opening bell Friday as investors continue to evaluate this week’s inflation data and the multitude of Federal Reserve (Fed) speakers discussing interest rate policy. The yield on the 10-year note is rising one basis point (0.01%) to 4.39%, while the 30-year bond yield is increasing two basis points (0.02%) to 4.53%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is down one basis point (0.01%) to 4.79%.

Treasury yields were higher on Thursday, with April’s housing starts increasing less than projections, while April’s industrial production stagnated, compared to an anticipated increase. The yield on the 10-year note was up four basis points (0.04%) to 4.38%, while the 30-year bond yield rose one basis point (0.01%) to 4.51%. The yield on the two-year note increased eight basis points (0.08%) to 4.80%.

On the data front today, the Conference Board’s U.S. Leading Economic Index is forecasted to decrease 0.3% month-over-month in April, similar to the prior month’s change.

In the central bank space, multiple Fed members are scheduled to speak today.

Mortgage rates were lower in the latest week. For the week ending May 16, the average 30-year fixed mortgage rate was down seven basis points (0.07%) to 7.02%, versus 6.39% a year ago. The 15-year fixed mortgage rate decreased 10 basis points (0.10%) to 6.28%, versus 5.75% a year ago.

The Bloomberg 30-day visible supply fell $1.129 billion to $11.574 billion on Wednesday, above the 12-month average of $9.173 billion.

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