US 10-year yields are at session lows, down 3.7 bps to 1.659%. Importantly, yields are now lower than they were before Friday’s non-farm payrolls report.
The failure of rates to move higher on good news is a sign that 1.75% is going to cap this leg of the climb in yields. There’s plenty of reason to be excited about the reopening but the Fed is pledging not to hike and foreign demand is high due to wide spreads above negative-yielding debt in Europe and Japan.
In the FX market, USD/JPY is down meaningfully for the second straight day.
Watch the mid-March highs near 109.40 for minor support.