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30Yr Treasury Bond Futures Fall to New Lows


Stock index futures were temporarily supported by a stronger than expected housing report.

Housing starts in March were 1.793 million when 1.750 million were anticipated and permits were 1.873 million, which compares to the estimated 1.830 million.

The dominant influences remain geopolitical tensions and the hawkish Federal Reserve.


The U.S. dollar index advanced to a new two-year high, underpinned by recent hawkish comments from Federal Reserve officials and flight to quality buying.

Higher prices are likely for the greenback.

There was support for the euro currency when the yield on the German 10-year Bund advanced past 0.88% for the first time since 2015.

Housing starts in Canada fell by 2.0% over a month earlier to 246,243 units in March of 2022, below market expectations of 250,000 units.

The Japanese yen declined to its lowest level in nearly 20 years, as the Bank of Japan’s  commitment to maintain ultra-easy monetary policies contrasts sharply with other major central banks that are hiking interest rates. The BoJ has also repeatedly intervened to keep benchmark bond yields around zero.

Interest rate differential expectations remain bearish for the Japanese yen and lower prices are likely.


The 30-year Treasury bond futures fell to new lows for the move and are at the lowest level since December 2018.

Yesterday, Federal Reserve Bank of St. Louis President James Bullard said he prefers a 50 basis point hike in the fed funds rate, but would not rule out a 75 basis point increase.

Federal Reserve speakers today are Charles Evans at 11:05 and Neel Kashkari at 7:00 this evening.

Currently there is a 91.0% probability of a 50 basis point increase and a 9.0% probability of a 25 basis point hike in the fed funds rate at the Federal Open Market Committee’s ’s May 4 policy meeting.

Lower prices are likely across the board for the interest rate futures market as most major central banks (not the Bank of Japan) are anticipated to tighten credit policies this year.

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Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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