HALISTER1: Avg Respondent a Buyer of 10Y USTs at 2.63% Yield: BMO Survey

Avg Respondent a Buyer of 10Y USTs at 2.63% Yield: BMO Survey

(Bloomberg) -- Just 39% of respondents would buy the dip in USTs, the lowest since January, while 51% were willing to sell a bounce, the most since March 2014, BMO strategist Ian Lyngen writes in summary of November survey results.
  • If market sold off, 51% of respondents would not take action
  • Results for direction of 5s showed that 42% expect the next 15bp will be higher, while 41% expect it will be lower; divergence “suggests some hope” that current selloff will bottom out in near-term
  • Avg respondent thinks 3.26% y/y avg hourly earnings would lead Fed to worry about wage inflation
  • Top issue for USTs next year was almost unanimously “Trump’s fiscal policies and their success,” as well as reflation, USD, global monetary policy and China
  • NOTE: Avg hourly earnings, as well as NFP, unemployment rate and avg weekly hours reports due Dec. 2 at 8:30am ET
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Source: BFW (Bloomberg First Word)

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Ian Lyngen (Bank of Montreal)

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