A lot of important data both in Canada and the US, along with political developments abroad, have caused very little change in the bond market in aggregate.
First up, Canadian GDP grew 0.4% on a seasonally adjusted basis in November (+0.3% exp.), thanks to strong showings in the oil and gas sector, as well as wholesale and retail trade.
Meanwhile, the US consumer keeps swinging: For December, Personal Income grew +0.4% (+0.4% exp.) and Personal Spending grew 0.7% (+0.5%).
These moderately positive releases normally may have pushed rates higher by a few basis points, but with the uncertainty in Egypt having the potential for far-reaching political and economic impact, the bond market seems to be maintaining a cautious edge.
Tags: Canadian GDP, bond market, commercial financing, apartment financing, commercial mortgages, multi-family mortgages, oil and gas sector, december 2010, personal income, us consumer, personal spending
The market has sold off somewhat this morning as US private payrolls as reported by ADP increased by 297,000 in December, well in excess of the 100,000 that had been forecast. This is a very strong number and is likely to cause some revisions to forecasts for the official NonFarm payrolls numbers on Friday.
Canadian data this morning was limited to Industrial Product Price and Raw Materials Price Index growth for November, both of which were higher than forecast.
There is some more important data out over the balance of the week:
Thu: Canada [Ivey PMI]
Fri: US [Employment / Unemployment Rate, Consumer Credit]; Canada [Employment / Unemployment Rate]
The bond market has rallied modestly this morning following the selloff late yesterday.
Largely responsible for stabilizing yields this morning are the US CPI numbers for November, which at 0.1% MoM, were lower than market expectations for 0.2%. These serve as a reminder that while the market has moved to price in certain events, the inflation is not yet evident.
Other positive data in the US include the Empire Manufacturing Index for December at 10.57 (exp. 5.0), growth in Industrial Production for November of 0.4% (exp. 0.3%), and an uptick in Capacity Utilization to 75.2% (exp. 75.0%).
The only Canadian data out this morning was October Manufacturing Sales which were up 1.7% (exp. 1.0%).
In summary, lots of data suggesting the economy is moving in the right direction, but if inflation lurks, it remains well hidden.