Good Friday AM,

Bonds are up slightly on the day. They did their normal ‘sell first and ask questions later’ after Powell spoke yesterday. We have a good chance to continue to grind our way up in price. Remember, bottom is often choppy and the path up is not a linear path, so we should expect a bit of two steps up and one step back as we hopefully build momentum in the climb. The news today was very bond friendly with retail sales, consumer sentiment and Empire manufacturing all getting hammered. We should all be concerned about Retail Sales and the jobless claim numbers as they are pointing at a double dip recession. Keep in mind that economic data is less important to bonds at the moment, relative to political developments (mainly… how quickly will the next round of stimulus make it through Congress?  How much weight will it shed before hitting Biden’s desk?  And how effectively will Biden be able to accelerate vaccine distribution?)  This morning’s Retail Sales number would normally have a more noticeable impact, but even after coming in at -0.7 vs 0.0, bonds have barely budged.

Please remain safe and healthy, enjoy the weekend, make today great!