Treasury Action: yields plunged with the weaker data streak Treasury Action: yields plunged with the weaker data streak extended today after the plunge in housing starts, modest rise in jobless claims and tame core CPI. The T-note yield stalled out ahead of 1.96% into these reports, then spilled lower to 1.90% before stabilizing again. The 2s-10s spread flattened from the +172 bp area to +166 bp.
U.S. CPI Preview U.S. CPI Preview: April headline CPI is expected to show a 0.1% decline (median -0.1%), while the core index rises 0.2% (median 0.2%). The 0.2% March CPI headline drop undershot expectations due to a 2.6% energy price drop that captured a big chunk of the 3.4% decline in the March PPI report and a flat food price figure. Today's 0.7% PPI decline for April was led by another big energy price drop and a smaller food price decline.