U.S. sovereign bonds rose on Monday, following better-than-expected U.S. durable goods orders and a sell-off in global stock markets and commodities lifted demand for safe-haven assets. Durable goods orders for June rose 3.4 percent with economists expecting them to increase 3 percent.
“Bottom line, putting aside the volatile headline figure which was boosted by aircraft orders, non defense capital goods ex aircraft, otherwise known as core cap ex, rebounded in June from May but the absolute level of spend is still below where it was in March and is still down 5.2% y/o/y,” Peter Boockvar, chief market analyst at The Lindsey Group, said in a note.
Still, any gains in the bond market were likely to be tempered ahead of a two-day U.S. Federal Reserve meeting that kicks off on Tuesday and could shed light on whether the central bank is getting ready to hike rates in September as many expect.
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