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10/27/2011
Well, the umpteenth time seems to be the charm as the latest EU summit has finally produced a plan to manage the debt crisis. Some critical details still need to be figured out, (such as, is a voluntary haircut/write-down still considered a default?), but treasury prices are sharply lower this morning as a result. In US economic news, the 3rd Qtr GDP report was largely in line with expectations, with the exception being a surprised +2.4% increase in personal consumption vs expectations of a +1.9% increase. The weekly jobless claims report produced a mixed bag of results with continuing claims slightly better than expectations but initial claims slightly worse. Currently, the 10yr yield is at 2.288% (2.130% Wednesday) and the 2-10 yield spread is at 199bps, steeper by 13bps since yesterday morning.
