Oddly today, the FX move appeared to lead the move in bonds.
I wrote earlier how the sudden dollar rally wasn’t supported by yields as the curve was very close to flat. Well that’s changed in a hurry with US 10s jumping to 3.78% from 3.72% in about 30 minutes.
Again, there isn’t a clear catalyst for this but likely reflects positioning and angst ahead of tomorrow’s US CPI report. The consensus is +0.2% m/m and +4.1% y/y but I wonder if more people are thinking about this chart and the potential for higher rates down the road.