High GDP Indicates Rates May Stay Elevated Longer
Thursday morning saw GDP come in at 4.9% which is the highest print in 2 years and 4-tenths better than the estimated 4.5% for the quarter. The GDP print is another example of how the American consumer continues to spend and is a likely indicator that higher rates for longer is a real possibility. Even with the upside surprise in GDP yields have begun to tumble back down to that 4.85 support level.
A strong treasury auction as investors look for safety from geopolitical turmoil going into the weekend seems to be the culprit for the downward pressure on yields. With the growing narrative of higher rates for longer and the ongoing geopolitical pressures, you can expect the volatility to persist.