Treasury Action: yields wavered on the CPI report
Treasury Action: yields wavered on the CPI report as the data, where the headline number came in a little below forecast, but the core met expectations. After the miss on PPI yesterday, though, traders were geared up for more disappointment. Nevertheless, the data largely confirm the softer trend in prices and will keep the FOMC sidelined next month, in terms of their rate stance, though policymakers can still announced QT. The belly of the curve is outperforming with yields down almost 2 bps to a 1.756% rate on the 5-year note. The 10-year is off about 1 bp to 2.189%, though importantly below the 2.20% psych level and the lowest in over a month. The bond, meanwhile, couldn't make any further headway and is 1 bp higher at 2.786% after testing 2.767%.