10-Year yields dropped to 4.01%, the lowest level since Thanksgiving, before reversing to close the session unchanged at 4.05%. The market has seen yields decline approximately 25 basis points since early February as participants price in potential rate cuts. Notably, volatility metrics firmed despite the drop in yields, signaling a divergence from typical correlations. Traders are now positioning for upcoming data releases, including December durable goods, a 16 billion 20-Year bond auction, and the January FOMC minutes.
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