Bond Market Commentary

Over in bond land, Treasury yields are mostly lower before the opening bell Tuesday ahead of today’s Consumer Price Index (CPI) report for June. As of 6:45 AM ET, the yield on the 10-year note is decreasing two basis points (0.02%) to 4.41%, while the 30-year bond yield is falling three basis points (0.03%) to 4.95%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is unchanged at 3.90%.

Treasury yields were higher on Monday as investors digested the recent updates on tariffs and trade negotiations. The yield on the 10-year note was up two basis points (0.02%) to 4.43%, while the 30-year bond yield rose three basis points (0.03%) to 4.98%. The yield on the two-year note increased one basis point (0.01%) to 3.90%.

On the data front, the Federal Reserve (Fed) Bank of New York will release July’s Empire State Manufacturing Survey, with the headline general business conditions index expected to come in at negative 9.2 from the prior month’s negative 16.0. The headline CPI for June is expected to show price increases of 0.3% month-over-month (MOM) and 2.6% year-over-year (YOY) versus the prior month’s increases of 0.1% and 2.4%, respectively. Meanwhile, core CPI is expected to show price increases of 0.3% MOM and 2.9% YOY, versus the prior month’s increases of 0.1% and 2.8%, respectively. Data on June’s average hourly and weekly earnings is also scheduled for release.

In the auction space, the U.S. Treasury is set to issue $70 billion in six-week bills.

In the central bank space, Fed Governor Michael Barr, Fed Governor Michelle Bowman, Richmond Fed President Tom Barkin, Boston Fed President Susan Collins, and Dallas Fed President Lorie Logan are scheduled to speak today.

The Bloomberg 30-day visible supply rose $6.013 billion to $20.435 billion on Monday, above the 12-month average of $13.918 billion.

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