Treasury Action: yields remain lower but off earlier nadirs
Treasury Action: yields remain lower but off earlier nadirs. The 2s-10s curve is fractionally narrower at 89 bps from nearly 91 bps yesterday as the long end outperformed. The 2-year rate has backed up to 1.330% from an earlier low of 1.318%. Similarly the 10-year is at 2.237% from a test of 2.208%. Safe haven buying has cooled, in part on comments from Tillerson who said Americans should have "no concerns" over President Trump's rhetoric. Additionally, the 10-year auction was very poorly subscribed. The markets are looking ahead to Friday's CPI report for more clues on Fed policy. However, comments from Evans and Bullard suggest QT is still on track to begin in the fall. While Bullard indicated he'd like to pause further hikes, Evans said that could be dependent on inflation. He wants more evidence that it is heading toward the 2% target.