Weak July jobs print reset the bond narrative — yields drifted lower and the published tone turned more dovish into the weekend.
Early in the week, research was split. One camp argued the 2-year was "unambiguously" calling for hikes, with the front end trading well above the funds rate and inflation credibility at stake. Others flagged structural upward pressure at the long end: fiscal supply, hyperscaler capex crowding out buyers, and lighter foreign demand from Japan and China. One thread even mapped a scenario where a yen carry unwind forces Japanese selling of Treasuries.
After the soft payrolls print, the published consensus shifted toward lower yields late in the week. Multiple analysts described a "ginormous" move lower in the 2-year, a roughly 10bp weekly drop in the 10-year, and September repriced to a coin flip. Several argued the Fed is now on an extended hold as labor softens.
On credit, researchers flagged investment-grade spreads widening 8–10bp on heavy AI-linked issuance, while all-in IG yields near 5.3% were still framed as attractive income. A bullish call on 30-year TIPS near 3% real was described as asymmetric.