The strong buyers at yesterday’s 10-year auction may have been the tell. Real money bought heavily despite a stronger non-farm payrolls report and CPI uncertainty.

Today they’re certainly happy they did as they locked in 4.438% compared to cash rates at 4.288% now. Yields are down 11.5 bps in the aftermath of a CPI report that was almost universally cool. It shows a high likelihood that FOMC officials will signal two rate cuts this year in the dot plot and that Powell will continue to be dovish.

Breakevens are telling the same story as they near the February low.

US 10s have now carved out a series of lower highs and briefly touched the lowest since April 1.