Treasury Market Outlook: Treasury yields are fractionally higher
Treasury Market Outlook: Treasury yields are fractionally higher with the 2-year at 2.308% and the 10-year at 2.863% ahead of the start of the 2-day FOMC meeting. Core European rates are up 1.2 bps to 0.577% on the Bund and 1.455% on the Gilt. Asian rates closed with small declines, leaving the JGB at 0.032%. Weaker than expected data out of Europe, including a slump in the German ZEW confidence number to 5.1 in March, the lowest since September 2016, and slowing in German and U.K. inflation, had little impact. Japanese markets were choppy after Trade Minister Seko said Japan is likely to secure trade exemptions, which was offset by BoJ Deputy Governor Amamiya's comment that it could adjust rates before the 2% inflation target is met. Meanwhile, the FOMC begins its two-day meeting and the markets are likely to hunker down ahead of an all but certain 25 bp rate hike tomorrow, while the focus will be on the dot plot. Today's calendar is otherwise light with just weekly chain store sales. FedEx is on the earnings slate.