Treasury yields rose on Monday, taking back some of last week’s slide, ahead of the latest update on U.S. consumer spending, a key driver of the U.S.’s expansion so far.
The 10-year Treasury note yield TMUBMUSD10Y, +0.34% picked up 2.3 basis points to 2.648%, while the 2-year note yield TMUBMUSD02Y, +0.33% was up 1.6 basis points to 2.479%. The 30-year bond yield TMUBMUSD30Y, +0.50% added 2.8 basis points to 3.037%, Tradeweb data show. Bond prices move inversely to yields.
Retail sales for January, delayed due to the government shutdown, will come in at 8:30 a.m. Eastern time. Economists polled by MarketWatch expect an 0.1% increase, after a sharp 1.2% decline in December. The weaker-than-expecting reading at the end of the year triggered concerns that a pillar of the U.S. expansion, which has stood strong even as other areas like manufacturing have lost momentum, could be faltering. But many analysts expect the tepid December data to be revised higher, in line with other gauges of retail activity.
“One key aspect of the January report will be to see whether the initial December estimates are revised higher. That could be key, as a meaningful upward revision would lift consumer spending in Q4 and put the Q1 consumer estimates on sounder footing,” wrote Omair Sharif, senior U.S. economist for Société Générale.
Fed Chairman Jerome Powell will give videotaped comments the National Community Reinvestment Coalition’s Just Economy Conference in Washington, D.C. at 7 p.m. Eastern time, after appearing in “60 Minutes” on Sunday. Powell reaffirmed his confidence in the U.S. expansion, but said to the CBS News program that he felt no need to tweak interest-rate policy at the moment.
See: Fed’s pause now extends through September in wake of weak jobs report
The German 10-year government bond yield TMBMKDE-10Y, -2.68% remains at 0.066%. The proxy for the eurozone bond market declined sharply last week after the European Central Bank’s announced another round of stimulus for its banking system, and slashed its forecasts for economic growth for 2019 to 1.1% from 1.7%.
Read: ECB remains gloomy — and loose, for longer
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