Bonds

The timing of major upcoming shifts in Treasury supply and demand will be crucial in determining if the recent downward trend in yields continues or finally reverses.

Federal Reserve officials are moving closer to when they can start reducing massive support for the U.S. economy.

Consumer price spikes, which in June surged the most since 2008, will likely be a temporary feature of an economy that’s quickly recovering from the pandemic, said Federal Reserve Bank of San Francisco President Mary Daly.

But others warn that the optimism is unsustainable as a successful vaccine rollout doesn’t necessarily equate to the return of pre-pandemic work and travel habits.

U.S. government debt just logged its best week since August after the Treasury demanded the Fed return unused funds from emergency lending programs, a request the central bank said late Friday it would comply with. The development bolstered Wall Street predictions that the Fed will unveil more monetary action when it meets in mid-December.

Gross supply as of the end of June has already reached $1.2 trillion, a torrid pace considering the last decade has averaged $1.3 trillion per annum.

The Federal Reserve committed Monday to conducting more asset purchases of Treasury securities and mortgage-backed securities and announced $300 billion in new financing for credit facilities.

High-grade corporate bonds bested mortgages by a wide margin in 2019 and are likely to outperform them again this year, according to JPMorgan Chase & Co.

The federal government has opened a criminal investigation into whether traders manipulated prices in the $550 billion market for corporate bonds issued by Fannie Mae and Freddie Mac, according to people familiar with the matter.

Bank of Montreal is bundling uninsured residential mortgages into bonds in what could be the start of a new financing market for Canadian banks as the government scales back its support for home loans.

A Cathedral City, Calif., master-planned community has drawn on reserves twice in the past six months for bonds issued to build the project's infrastructure.