Feb 17. US economic data remains firm, stocks at new highs
Feb 17. Tens again flirting with 2% yield, closing +6 bps yesterday at 1.99 and this morning just above at 2.01%. Economic data continues to surprise on the strong side (and Core PPI was +0.4 yesterday); stocks chug to new highs. Today’s news includes CPI expected +0.3 with Core +0.2. Leading Indicators expected +0.5.
–I don’t know if this is interesting or not, but Blue eurodollar futures (4th year) total open interest is only 565k contracts. Blue June puts alone have 800k in open interest, mostly in 9837 and 9812 strikes.
–Crude oil continues to hold above $100/bbl. Central bank liquidity and Iran tensions are supportive of the price and not likely to change in the short term. Increasing gasoline prices seem to impact the economy with a lag, but I think we’re facing headwinds on energy prices. I was somewhat taken aback to see that commuter train fares had increased 34% when I went to buy a ticket yesterday. On the other hand, the mild winter in the midwest cut heating bills in half.
–Not much to say or report this morning, so I will fall back on the riveting topic discussed over drinks yesterday afternoon. The EDM2 9937/9950/9962 iron butterfly settled at 9.75. There is a chance of legging 10’s. Good sale. There.
–New high EUR/JPY at 104…was as low as 97 in early Jan, as yen continues to project weakness.
