Cantella Rates and Credit Dashboard-11/16/21

According to Nick Timiroas of the W.S.J. , President Biden will choose between Jay Powell and Lael Brainard sometime before Thanksgiving to be Fed Chair. Brainard and Powell each met the President for an hour November 4th in a meeting with just one advisor, NEC Director Brian Deese.?Brainard’s meeting went well Timiraos said , running over the hour allotted.?Goldman came out raising their S+P target for 2022 to 5100, currently at 4681. 10’s hit a 1.63% yesterday while 5’s hit a 1.265%., currently at 1.62% and 1.27%.?The MOVE INDEX , an index showing the yield curve which is a yield curve weighted index of the normalized implied volatility on 1 month Treasury options.?It is the weighted average of volatilities on the CT2, CT5, CT10, and CT 30. Treasury volatility has moved up over 20 points since mid-October , about 33%...81.59, highest since April 2020.?Meanwhile, the US Government Securities Liquidity Index closed at a 20 month high last week.?I know all of this is a bit wonkish , but it bodes to some difficulties in the Rates complex going into year-end.?CREDIT:?Evidently there is stronger demand for Credit from overseas accounts. In High yield , CCC’s saw yields rise to a eight month high to close at 6.70%, up 17 bps., the biggest one-day increase in five weeks.?Issuance in investment grade was around 20 billion. IG 36 opens at 51.?Many of my customers have shared with me that as long as Credit remains strong they do not see a significant sell-off in other Risk assets.?Have a nice day.

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