Last week was mostly quiet, with markets being closed on Friday and open in a limited capacity on Thursday. 10-year swap rates finished the week flat, and 2-year swaps rose 7 BPS WoW. The economy seems to be fairly strong, with durable goods figures coming in relatively well on Tuesday.
The highlight of the week was the PCE release, which came out on Friday while markets were closed. Monthly Core PCE came in right on top of expectations at .3%, and the January figure was revised up to 0.5%. Rates have ticked up today, but the market seems to be taking the news well.
There were 3 TSY auctions last week (2’s, 5’s, & 7’s) that were all well received. Last week’s focus was on inflation, but this week will be about jobs. We have JOLTS figures coming in on Tuesday and Nonfarm payroll on Friday. We’ve seen three consecutive months of job growth surpassing 200,000, which is a good sign. The unemployment rate should remain at around 3.8%, assuming there are no surprises with this week’s data.
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