Treasuries rallied overnight amid weaker Asian equity markets (follow-through from weaker U.S. close yesterday) and another round of disappointing European economic data. Intermediate and long-end Treasury yields are down 3-4 basis points this morning, and U.S. equities are poised to bounce higher at the open (S&P 500 futures +13 points). Yesterday’s FOMC minutes (January meeting) simply reinforced the perception that the Fed is committed to continuing with a gradual normalization plan, which pushed long-end yields higher (10yr Treasury broke above 2.95%) and stocks lower. A senior economic advisor to Japanese Prime Minister Shinzo Abe said the Bank of Japan should consider buying foreign bonds as part of its current quantitative easing program. Such purchases are currently prohibited by BOJ guidelines and are generally frowned upon by Japan’s G-20 counterparts. The ultimate goal of foreign asset purchases would be currency depreciation in an attempt to reflate the economy (i.e., currency manipulation).

Jason Haley
Managing Director, Investment Management Group

Date TimeEventSurveyActualPriorRevisedRelevance
02/21/2018 07:00MBA Mortgage Applications-6.60%-4.10%92.3077
02/21/2018 09:45Markit US Manufacturing PMI55.555.955.590
02/21/2018 09:45Markit US Services PMI53.755.953.370
02/21/2018 09:45Markit US Composite PMI55.953.870
02/21/2018 10:00Revisions: Existing Home Sales0
02/21/2018 10:00Existing Home Sales5.60m5.38m5.57m5.56m88.2812
02/21/2018 10:00Existing Home Sales MoM0.50%-3.20%-3.60%-2.80%52.3438
02/21/2018 13:00Bloomberg Economic Expectations54.552.549.2188
02/21/2018 13:00Bloomberg Consumer Comfort56.65767.9688
02/21/2018 14:00FOMC Meeting Minutes14.0625
02/22/2018 08:30Initial Jobless Claims230k222k230k229k98.4375
02/22/2018 08:30Continuing Claims1935k1875k1942k1948k68.9062
02/22/2018 10:00Leading Index0.70%0.60%83.5938
02/22/2018 11:00Kansas City Fed Manf. Activity181621.0938