UMBS up 2 bps on the open.

Q4 GDP (revision) = 3.2 vs 3.3 f’cast

GDP PCE Price Index = 2.1 vs 2.0 f’cast

Wholesale Inventories = -09.1 vs 0.1 f’cast, 0.4 prev

None of this morning’s data matters.  It might matter more if it were the initial GDP release for the quarter, but even then, we’d be looking back 3-5 months in the past at a time when the latest possible economic developments are of the utmost importance.

The trading response confirms the market’s lack of interest in the data.

S&P 500 contracts dropped 0.3%. Treasury two-year yields, which are more sensitive to imminent policy moves, slipped two basis points to 4.67%. The dollar advanced. Cryptocurrency-linked stocks jumped after Bitcoin breached $60,000.

FROM BLOOMBERG, but sums it up perfectly:  Bond traders no longer predict the Federal Reserve will cut interest rates by more than 75 basis points this year, with the view now finally in line with what the central bank itself has indicated as the likeliest outcome. That closes a gap that has been narrowing since the start of the year between what traders forecast for rate cuts this year and the pushback against those bets by central banks. That’s unraveling what was supposed to be the big bond trade of 2024 — the yield curve returning to a traditional upward slope.

More problems for real estate agents: A lawsuit filed in California targets buyer agent commissions, arguing that they should be zero. “For years buyer broker commission rates have remained stable despite a) the increase in home values, making those commissions much more valuable, and b) the diminishment to near nothing of what buyer brokers actually do to earn their commission,” the complaint says…”A truly competitive rate for buyers’ agents would in fact be 0% or $0 as, in the vast majority of cases, buyers’ agents do minimal if any work to secure a sale, with buyers doing much of their own searching via popular websites like, and itself,” the suit alleges.

There were a few instances of volatility in the bond market today with several of the larger moves lining up with larger doses of volume.  In a “data dependent” world, it’s odd to consider that none of the notable moves had anything to do with economic data.  Instead, it was a surge in corporate bond issuance around 9am causing some selling and the 3pm close causing some buying.  And EVEN THEN, those events added up to a pittance of activity and drama.  Bonds managed to clock modest gains, but that only served to solidify the sideways trend that’s been in place since the Feb 13 CPI data.

UMBS ended the day up 19 bps at 100.39

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