Weak Data Fuels Bond Rally

"U.S. yields dropped on Wednesday after the Treasury Department announced it would double the size of its bond buybacks from $2 billion to 'at least $4 billion,' a move aimed at stabilizing the bond market by injecting it with more liquidity. Recent data on home sales and import prices also came in better than expected, Oxford Economics said in a report Wednesday, putting further downward pressure on bond yields and allowing the market to stabilize."

"a report showed shoppers spent less at U.S. retailers last month than the month before. Such data could keep interest rates low"

"Unexpectedly, US employers reduced jobs in July, and hiring figures for the previous two months were revised downward, indicating that the labour market is weaker than previously believed. Nonfarm payrolls fell by 23,000 last month, following a total downward revision of 103,000 for the May and June figures."

"T-notes also have carryover support from last Thursday's weaker-than-expected Jun payrolls report, which reduced the chances of the Fed tightening monetary policy."

"T-notes settled little changed on Friday and found support on the -3% plunge in crude oil prices, which eased inflation expectations. Also, Friday’s weaker-than-expected Apr ISM manufacturing report was bullish for T-notes."

"T-note prices found support on Thursday from weaker-than-expected US economic news. Q4 GDP was unexpectedly revised downward, Feb personal income and spending came in lower than expected, and weekly jobless claims rose to an 8-week high."

"Today’s report showing a slower-than-expected increase in Eurozone Dec core consumer prices eased inflation concerns and sent European bond yields lower."

"Downbeat economic data is delivering gains to stock and bond bulls alike, as weaker-than-expected retail sales and consumer confidence numbers coincide with accelerating job losses and rising odds of a December Fed cut."