The big tail in today's US 30-year reopening is a fresh sign that once the Fed stops buying, there won't be a bid in fixed income, especially with inflation where it is.
Tomorrow we will get a fresh look at the start of US prices and there's fresh reason for worry today after President Biden said the November report won't reflect the recent declines in some prices, especially energy.
That comment has people thinking that he's seen the numbers. I don't think that's the case as the protocol is to deliver sensitive data to the White House late in the afternoon before it's released. Instead, it's probably a reaction to the economists' consensus, which is a rise to 6.8% from 6.2% in October.
If I'm wrong, he could be signaling the number will be above 7%, which is a painful threshold that would also solidify expectations for a faster Fed taper announcement next Wednesday.
A key chart I continue to watch is 10-year yields. I highlighted it at the start of the week as they challenged the uptrend. That held but we're not right in the middle of the range with the market trying to figure out if it's more worried about omicron or inflation.
