In today’s update on September 29th, Mortgage-Backed Securities (MBS) gained 16 basis points, with S&P futures up 30.25 points. European bonds strengthened due to low EU inflation and steep declines in German import prices.
PCE data initially rallied but later fluctuated, possibly due to a core monthly figure close to expectations.
- Core PCE m/m: 0.1 vs. 0.2 forecast, 0.2 previous
- Core PCE y/y: 3.9 vs. 3.9 forecast, 4.3 previous
- Personal Spending: +0.4% MoM vs. 0.5%
The likelihood of a government shutdown looms, with minimal actual impact expected.
Consumer sentiment decreased in September, with moderating inflation expectations, offering a positive sign.
Bonds improved overnight, navigating uncertainty around the shutdown and month-end tradeflows, as the most crucial data week approaches without key reports.
Bonds ended the day down 11 basis points, marking a 38 basis point drop from the day’s highs.