Treasury Action: yields topped out
Treasury Action: yields topped out after the 9% dive in housing starts, though partly offset by a 6.3% bounce in permits. The headline shortfall was a surprise, however, with the low rate environment generally keeping the sector afloat, though economists will no doubt seek an explanation in the weather during hurricane season. The 2-year yield had rebounded from 0.795% lows to 0.81%, where it stalled; the 5-year is up from 1.22% lows, but topped at 1.245%; the 10-year rebounded from 1.736% overnight lows to 1.76% before stalling; the cash bond yield snapped back from 2.49% lows to 2.523% highs before easing to 2.52%. That's left yields marginally higher along the curve, in a relatively parallel shift.