Bonds Hold Ground Despite Data Beats — 30yr Closes at 6.45%

The 30-year fixed closed Wednesday at 6.45% — down 2 basis points from Tuesday's 6.47%. The 10-year Treasury settled at 4.295%, off 1.8 basis points from yesterday's close of 4.316%. UMBS 5.0 picked up 9 ticks on the day to finish at 98.69.

Today's close is worth noting for what it absorbed. ADP private payrolls for March came in at 62,000 — well above the 40,000 forecast — and February retail sales also beat expectations. Both releases landed at 8:15 AM ET and unwound the overnight rally almost instantly. The 10-year had been as low as 4.285% on hopes that Trump would exit the Iran conflict soon; by mid-morning, those gains were fully reversed and the 10-year was back to 4.314%. From there, bonds slowly recovered through the afternoon and closed below yesterday's level anyway. Rates at 6.45% still hold the Q1 improvement from the mid-March peak of 6.64%.

Tomorrow is the event everyone is watching. April 2 is "Liberation Day" — the Trump administration's sweeping tariff announcement. If the tariff scope lands wider than expected, expect a flight-to-quality bond bid and rates moving lower. A narrower rollout pushes yields back up. April 2 is the highest-volatility day of Q2.