Treasury yields are higher following the release of this morning’s economic data and hawkish Fedspeak, with front-end rates up 10-14 basis points as of 8:50am ET. Fed Governor Christopher Waller suggested monetary policy “needs to be tightened further” in comments before an audience in San Antonio this morning. He said the extent of additional tightening will be dependent, in part, on the extent of tightening credit conditions in the financial sector. Core retail sales fell less than expected last month (-0.3% vs -0.5%), and import prices fell more than expected. In other news, bank borrowing from the Fed slowed for a fourth consecutive week, falling $9.3 billion to $139.5 billion in total for the week ended April 12. This included a $7.2 billion decline in demand for the new Bank Term Funding Program (BTFP); however, total borrowing remains significantly elevated relative to the week prior to the Silicon Valley Bank failure ($15.2 billion). Two Fed leaders are speaking this morning.
Jason Haley
Chief Investment Officer
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