FAST FIVE: Weird Occurrings In The Bond Market… Even By Bond Market Standards
Those markets do not always move in the same direction (especially high yield and treasuries on risk-off or risk-on days).
Even the treasury market is often better explained by some combination of bull/bear and flatten/steeper than a single reference point.
Act 5: Discuss the importance of multi-year averages and hammer home how good inflation is to all those who question why we want inflation.
No hike, but steeper curves with longer maturity yields creeping higher (caveated by a real risk of a serious “risk-off” mood that would be a huge bid to treasuries, which could be particularly violent since so many now seem to be underweight longer dated treasuries).
Equity investors seem to have been focused more on hike/no hike talk and not enough on where longer dated bond yields are headed, which is likely to enter their consciousness in the coming days.