U.S. job openings were expected to show a decline in February to 10.4 million from 10.82 million the month before, according to a Reuters poll of economists.
"Cooling down of the labor market is one of the things necessary to combat inflation and it's one of the things necessary to see on the horizon the Fed switching from a tightening bias toward accommodation," said Andrzej Skiba, head of the BlueBay U.S. fixed income team at RBC Global Asset Management in New York. The drop in two-year yields, which have declined more than 100 basis points since Silicon Valley Bank failed on March 10, pushed them below the low end of a 4% range they had roughly hugged in choppy trade since mid-March.
"The market is healing from the turbulence of the last few weeks," Skiba said. "It's just about the markets reversing some of the bearishness that we've seen in the last few weeks and the fact we're not being hit with negative headlines as we walk into the office every morning." Earlier on Tuesday, the Reserve Bank of Australia left its cash rate unchanged at 3.6%, snapping 10 straight hikes, saying it wanted to assess the impact of past increases whose effect lags, as the economy slows and inflation has peaked. The yield on the 30-year Treasury bond was
down 3.1 basis points to
3.615
%.
A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes , seen as an indicator of economic expectations, was at -47.1 basis points.
The breakeven rate on five-year U.S. Treasury Inflation-Protected Securities (TIPS) was last at 2.432%. The 10-year TIPS breakeven rate was last at 2.274%, indicating the market sees inflation averaging about 2.3% a year for the next decade. The U.S. dollar 5 years forward inflation-linked swap , seen by some as a better gauge of inflation expectations due to possible distortions caused by the Fed's quantitative easing, was last at 2.440%. 10:26AM April 4 New York
Price Current Net
Yield % Change
(bps)
Three-month bills 4.63 4.7468 -0.055
Six-month bills 4.685 4.8754 -0.012
Two-year note 99-208/256 3.9738 -0.088
Three-year note 102-118/256 3.7343 -0.096
Five-year note 100-122/256 3.5199 -0.091
Seven-year note 100-228/256 3.4803 -0.081
10-year note 100-160/256 3.4245 -0.066
20-year bond 101-88/256 3.778 -0.045
30-year bond 99-176/256 3.6421 -0.046
DOLLAR SWAP SPREADS
Last (bps) Net
Change
(bps)
U.S. 2-year dollar swap spread 33.50 1.50
U.S. 3-year dollar swap spread 18.25 0.50
U.S. 5-year dollar swap spread 6.00 0.25
U.S. 10-year dollar swap spread -0.75 -0.25
U.S. 30-year dollar swap spread -42.75 1.75
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Australia pauses rate hikes to assess tightening impact Australia pauses rate hikes to assess tightening impact ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Herbert Lash, editing by Ed Osmond)
Messaging: herb.lash.reuters.com@reuters.net))