May 16, 2024
Over in bond land, Treasury yields are mixed before the opening bell Thursday as investors await the release of April’s industrial production, housing starts, and other key economic data. The yield on the 10-year note is unchanged at 4.34%, while the 30-year bond yield is falling one basis point (0.01%) to 4.49%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is up two basis points (0.02%) to 4.74%.
Treasury yields were lower on Wednesday, with the headline Consumer Price Index (CPI) for April coming in softer than expectations on a monthly basis and increasing in line with expectations on an annual basis. The yield on the 10-year note was down 10 basis points (0.10%) to 4.34%, while the 30-year bond yield fell nine basis points (0.09%) to 4.50%. The yield on the two-year note decreased nine basis points (0.09%) to 4.72%.
On the data front today, initial jobless claims for the week ending May 11 are expected to be 220,000, lower than the prior week’s 231,000, while continuing claims for the week ending May 4 are projected to register 1.78 million, slightly lower than the prior week’s 1.79 million. Housing starts for April are expected to be an annualized 1.42 million units, up from the prior month’s 1.32 million units, corresponding to an anticipated increase of 7.6% month-over-month (MoM) versus the prior month’s decrease of 14.7%. Meanwhile, April’s building permits issued are projected to be an annualized 1.48 million, up from the prior month’s revised reading of 1.47 million, corresponding to an expected increase of 0.9% MoM versus the prior month’s revised decrease of 3.7%. The Philadelphia Federal Reserve (Fed) business outlook survey for May will be released, with the diffusion index for current general activity projected to record 8.0 versus the prior month’s 15.5. April’s Import Price Index is expected to increase 0.3% MoM, down from the prior month’s increase of 0.4%. Meanwhile, April’s Export Price Index is projected to increase 0.2% MoM versus the prior month’s increase of 0.3%. Industrial production is expected to rise 0.1% MoM for April versus the prior month’s increase of 0.4%, while April’s capacity utilization is projected to register at 78.4%, similar to the prior month’s reading.
In the auction space, the U.S. Treasury is set to issue $80 billion in four-week bills and $80 billion in eight-week bills.
In the central bank space, multiple Fed speakers are scheduled to speak about the economic outlook, higher education, and healthcare.
Municipal Market Commentary
None at this time.
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