What really drove the two-year to the high yield of the day was the two-year note auction, and the Beige Book didn't do anything to help. |
Yes, the market developed a fear that employment would be stronger than it turned out to be, but it was still a pretty solid number, above economists' consensus forecast, so in general you're looking at recent economic numbers that have bond traders a little bit concerned. |
You have a Fed that is obviously going to move to 5 percent on May 10, while the majority of the recent data have surprised to the upside, and there is a growing perception the Fed may have to go even higher. |
You have seen a pretty significant rise in open interest in the Treasury futures market since the middle of last month as prices have declined, suggesting a pretty substantial short base out there, so we've held our footing so far this week. |