Bonds Drift Weaker Despite Lower Oil Prices

Bonds Drift Weaker Despite Lower Oil Prices Although they still technically made positive progress versus the end of last week, bonds ended the day moderately weaker. Lower oil prices offered no support, but that's a tricky correlation these days. Longer-term oil contracts continue lining up with bond yield movement more reliably. To be sure, we can at least consider the impact of this morning's CPI data based on decent trading volume at the time and a reversal of the sideways to slightly stronger momentum in the preceding few hours, but it's impossible to say that it continued weighing on bonds for the rest of the session. Econ Data / Events m/m CORE CPI (Mar) 0.2% vs 0.3% f'cast, 0.2% prev m/m Headline CPI (Mar) 0.9% vs 0.9% f'cast, 0.3% prev y/y CORE CPI (Mar) 2.6% vs 2.7% f'cast, 2.5% prev y/y Headline CPI (Mar) 3.3% vs 3.3% f'cast, 2.4% prev Market Movement Recap 10:58 AM Slightly weaker this AM but leveling off with MBS unchanged and 10yr up 3bps at 4.306 12:46 PM weakest levels. MBS down 3 ticks (.09) and 10yr up 4.2bps at 4.319 03:35 PM flat for the past few hours with MBS down 2 ticks (.06) and 10yr up 4bps at 4.316