Mandiri Sekuritas US BOND MARKET

􀂄 Wednesday's bond market has opened in negative territory following the release of stronger than expected consumer spending data. The stock markets are reacting favorably to the same data and financial reports from JPMorgan and Intel. The Dow is currently up 103.7 points (+0.94%) while the Nasdaq has boosted 39 points (+1.58%).
The bond market is currently down 5/32 with the 2-year note is off 0.25/32 to yield 1.05%, the 10-year note is off 10.5/32 to yield 3.86% and the 30-year note is off 25/32 to yield 4.73%.

􀂄 There are three relevant economic data released Wednesday:
1. The Commerce Department reported retail sales raised 1.6%mom, exceeding forecasts. This means that consumers spent more last month than many had thought. This is considered negative news for bonds.
2. March's Consumer Price Index (CPI) reported raised 0.1%mom for overall index or inline with market consensus. Meanwhile, the good news came in the more important core data that reported no change from February's level when vs. +0.1% increase of
market consensus. This indicates that inflationary pressures were softer than expected at the consumer level of the economy. That can be considered quite favorable for bond market.
3. The Federal Reserve also posted its Fed Beige Book report. Fed Chairman Bernanke expressed the Fed’s pledge to keep interest rates low for an extended period of time to assist the recovery of the economy.

􀂄 The only relevant data to be released is Industrial Production for March. It gives us a measurement of output at U.S. factories, mines and utilities, translating into a hint of manufacturing sector strength. Market consensus expected to show an increase in production of 0.7%mom. This data is considered to be only somewhat important, so it will still give an impact to bond trading.