Summary

• The US 10yr Treasury yield gapped lower on the back of Thursday’s data releases, which provided a whiff of macro weakness.
• The closely watched PCE inflation data came broadly as expected. Treasuries reacted to the consumer spending aspect within the first-quarter GDP data, dragging the real rate lower.
• EUR rates have followed the US lead lower, as front-end pricing of ECB hikes has also been pared back.

By Padhraic Garvey, CFA, Regional Head of Research, Americas, Benjamin Schroeder, Senior Rates Strategist, and Michiel Tukker, Senior UK & Eurozone Rates Strategist

Treasury yields headed lower on a whiff of macro weakness

The US