The bond market is moving sideways as the wait for an end to the Government Shutdown continues

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Published Date 10/10/2025

Early this morning the 10-year note was down 3 basis points from yesterday. Markets are waiting for Congress to re-open the government.

Fed Governor Waller spoke this morning. He supports more rate cuts but cautions that the Fed needs to be cautious due to what he said are conflicting economic signals. “I’m still in the belief we need to cut rates, but we need to kind of be cautious about it,” Waller said during an interview on CNBC’s “Squawk Box.” The labor market seems to be losing jobs, but GDP growth is strong. And inflation isn’t slowing. Waller is one of the candidates to be the next Fed chief.

Weekly jobless claims were not reported yesterday by the Labor Department due to the shutdown but Goldman Sachs did its own calculation. According to Goldman Sachs economists, weekly claims for the week ending on October 4th increased to about 235 thousand from 224 thousand the week prior. The week before that claims were 218 thousand. Continuing claims, a proxy for the number of people receiving benefits, ticked up to 1.92 million in the week ending on September 27th from the prior week’s estimated 1.91 million. If the assessment is correct, it verifies the labor market is slowing.

At 10 am the October mid-month University of Michigan consumer sentiment index was reported. It was expected to be 54.0 after the 55.1 reading from the end of September. The index was reported at 55.0.

This afternoon at 2 pm the Treasury is scheduled to report the September budget balance and fiscal 2025 deficit. It is unknown if it will be reported due to the shutdown.

Source: TBWS

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