e-Coops

BY REUTERS

Posted 12/8/2006

U.S. Treasuries beat a retreat on Friday after stronger-than-expected November job growth pointed to a stable economy, causing investors to change their expectations about the timing of a potential Federal Reserve interest-rate cut.

Growth in U.S. nonfarm payrolls totaled 132,000 jobs in November, more than the 110,000 predicted by economists in a Reuters poll and an increase from a revised 79,000 in October.

In recent weeks, fixed-income markets had responded to weak economic reports by estimating the timing for a Fed rate cut as early as March, said Stuart Hoffman, chief economist at PNC Financial Services Group in Pittsburgh, Pennsylvania.

“Now they have backed off that expectation and pushed the timing for a Fed rate cut back to June,” Hoffman said. “That’s the flip-flop the markets have been doing. When weak reports come out, the market raises the odds for a rate cut coming sooner rather than later. And then you get a couple of strong reports and they push the timing ahead into the second quarter.”

In late trade, the benchmark 10-year note was down 17/32, pushing its yield up to 4.56% as markets calculated that it was now less likely that the Fed would use its meeting this week to foreshadow lower rates next year.

A selling flurry near midday could have been linked to remarks by Treasury Secretary Henry Paulson, analysts say.

In an interview on CNBC, Paulson said China needed more foreign-exchange rate flexibility, though he declined to specify how much the Chinese currency should appreciate.

Traders say the jobs data were unlikely to change radically the market view that the Fed would cut rates next year to support a weaker economy.

Two-year notes were trading down 6/32 in price, pushing the yield up to 4.68%, while five-year paper was down 11/32, yielding 4.53%. The 30-year long bond was down 27/32 to yield 4.66%, versus 4.61% on Thursday.

Consistent with the mixed tone of recent data, a report from the University of Michigan showed a steeper decline in December consumer sentiment than markets had expected.

This entry was posted on Wednesday, February 28th, 2007 at 11:05 am and is filed under Finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

BY REUTERS

Posted 12/8/2006

U.S. Treasuries beat a retreat on Friday after stronger-than-expected November job growth pointed to a stable economy, causing investors to change their expectations about the timing of a potential Federal Reserve interest-rate cut.

Growth in U.S. nonfarm payrolls totaled 132,000 jobs in November, more than the 110,000 predicted by economists in a Reuters poll and an increase from a revised 79,000 in October.

In recent weeks, fixed-income markets had responded to weak economic reports by estimating the timing for a Fed rate cut as early as March, said Stuart Hoffman, chief economist at PNC Financial Services Group in Pittsburgh, Pennsylvania.

“Now they have backed off that expectation and pushed the timing for a Fed rate cut back to June,” Hoffman said. “That’s the flip-flop the markets have been doing. When weak reports come out, the market raises the odds for a rate cut coming sooner rather than later. And then you get a couple of strong reports and they push the timing ahead into the second quarter.”

In late trade, the benchmark 10-year note was down 17/32, pushing its yield up to 4.56% as markets calculated that it was now less likely that the Fed would use its meeting this week to foreshadow lower rates next year.

A selling flurry near midday could have been linked to remarks by Treasury Secretary Henry Paulson, analysts say.

In an interview on CNBC, Paulson said China needed more foreign-exchange rate flexibility, though he declined to specify how much the Chinese currency should appreciate.

Traders say the jobs data were unlikely to change radically the market view that the Fed would cut rates next year to support a weaker economy.

Two-year notes were trading down 6/32 in price, pushing the yield up to 4.68%, while five-year paper was down 11/32, yielding 4.53%. The 30-year long bond was down 27/32 to yield 4.66%, versus 4.61% on Thursday.

Consistent with the mixed tone of recent data, a report from the University of Michigan showed a steeper decline in December consumer sentiment than markets had expected.

This entry was posted on Tuesday, January 16th, 2007 at 9:00 pm and is filed under Finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.