Shorting bonds on expectations the Fed will shift to more hawkish rhetoric has been a murderous trade.
Even though the jobs report was very strong today there was still a sliver of disinflation in the avg hourly wage data and that was enough to stuff the Treasury sell off before it even got underway.
The belly of the curve is where the battle is taking place and Treasuries are struggling to sell off.
US 5 year note yield
The upcoming Fedspeak schedule:
- Oct 6 – George
- Oct 7 – Dudley and Kocherlakota
- Oct 9 – Bullard, Fischer (the gov), Tarullo, Williams
- Oct 10 – Plosser, George and Lacker (hawkish hat trick)
- Oct 11 – Tarullo, Williams
- Oct 15 – Beige book
- Oct 16 – Plosser, Lockhart
The two to watch closely are Dudley on Tuesday and Fischer on Thursday.
