Big news overnight in the treasury complex overnight as the 10-year breached 1% on a yield basis. This is significant as it’s the first time we have been at these levels since early 2020 when the pandemic started. There are a few reasons we are at these levels as investors believe once President Biden is sworn in we will see a major stimulus package before the end of the month which will put money in people’s pocket and hopefully increase consumer spending which should help in all aspects of the recovery. Another reason we are seeing a big jump in yields this morning is the because of the runoff elections in Georgia. It looks as if the Democrats will oversee all aspects of the government. As the Dems control taxes will most likely increase across the board which will result in higher inflation. Economic numbers this week will also be on trader’s minds as this morning we saw the ADP come in much lower than expected with a negative reading of 123k. The job outlook currently looks grim. Later this afternoon we will get the FOMC minutes which is a report that reviews economic and financial conditions in all four regions of the US. On Friday, we see the US monthly employment numbers which is expected to come in at 100K.  

10-yr Note Mar ’21 Daily Chart
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Greg Perlin

Senior Market Strategist
Greg is a former Chicago Board of Trade member. He was an independent floor trader, pit broker and floor broker with Cantor Fitzgerald. Some of his clients included traders from Morgan Stanley and Lehman Brothers. He also acted in the capacity of desk manager for the morning trade desk. Greg was part of the elite Lind Plus Division for 10 years before joining RJO Futures in 2011.
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