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Last night, the release of the U.S. JOLTS jobs data was postponed due to the partial shutdown of the federal government, while comments from Federal Reserve officials were mixed in tone. Richmond Fed President Barkin, a voting member next year, said that last year’s rate cuts helped support the labor market and that policymakers are now focused on bringing inflation back to the Fed’s target. Fed Governor Miran, a permanent voter, noted that there are no strong price pressures in the economy, implying that what he described as a still‑restrictive level of interest rates will need to be lowered again this year. In the primary market, there were nine issuers in total, bringing more than USD 21.4 billion of new supply, with financial names such as Bank of America, American Express and Visa making up the bulk of issuance. U.S. Treasuries, however, were mainly driven by the pullback in U.S. equities, as tech shares came under renewed selling pressure and a mild pickup in risk‑off sentiment pushed Treasury yields modestly lower into the close. The 2‑year Treasury yield fell 0.2 basis point to 3.57%, the 5‑year fell 0.3 basis point to 3.83%, the 10‑year declined 1.2 basis points to 4.27%, and the 30‑year was down 1.8 basis points at 4.89%. On the spread side, the yield curve flattened further, with the 2s10s positive spread closing at 69.6 basis points and the 5s30s positive spread at 106.3 basis points. Given that U.S. equities are consolidating near their highs, today the 10‑year Treasury yield is expected to continue trading in a 4.20%–4.26% range. Tonight, the U.S. will release ADP private payrolls and the ISM services index.

Separately, the Reserve Bank of Australia (RBA) unexpectedly hiked rates by 25 basis points yesterday, lifting the cash rate to 3.85%. In its post‑meeting statement, the RBA noted that part of the rise in inflation reflects capacity constraints, and therefore the Board judges that inflation will remain above target for some time. Those capacity pressures stem from stronger‑than‑expected demand momentum, with private‑sector demand growth driven by household consumption and investment. The labour market remains tight, in line with the recent trend of solid economic activity. At the subsequent press conference, Governor Bullock said the Bank remains cautious about the current inflation outlook and gave no explicit forward guidance on the future path of interest rates.