PCE faced a high hurdle to move the market today.it didn’t clear it

Today’s calendar could have included something called the Fed-recommended inflation indicator (the core PCE price index), but CPI data (out two weeks early). So it’s not surprising that we haven’t seen any reaction to PCE this morning. In fact, bonds are strengthening despite PCE signaling a sell-off. The only “yeah, but” is that the curve is more inverted (2 years weaker than 10 years), which is actually in line with the PCE results. The simplest case to create guidance for is for UK bonds to fluctuate significantly during the EU open and then rise again in the US morning.

Overall, we think this week’s volatility will help the bond market’s efforts to find a ceiling for recent selling. Determining the bottom of the current trading range is best left to the next week’s data. Specifically, next week’s ISM/NFP combo and next week’s CPI. 2.72% is a bit sticky so far this week (he bounces close to it in 4 out of 5 days) but at current levels the momentum indicator will change decisively as he finishes the day To do.