Week of January 8, 2012 thru January 14, 2012

Talk From The Trenches: Fed, Housing, Europe Trump Jobs


NEW YORK, Jan 6 (MNI) - The monthly non-farm payrolls report was stronger than expected but after a mild dip the Treasury market traded right back up again as nervous investors used the dip to add to safe haven positions.

Credit Default Swaps: Global Indexes Mixed, Euro SOVX Weak


CHICAGO, Jan 6 (MNI) - The benchmark investment-grade indexes on global Credit Default Swaps were mildly mixed at midday Friday with European sovereigns underperforming amid another brutal session.

Credit Default Swaps: Global Indexes Mixed, Euro SOVX Weak


CHICAGO, Jan 6 (MNI) - The benchmark investment-grade indexes on global Credit Default Swaps were mildly mixed at midday Friday with European sovereigns underperforming amid another brutal session.

The U.S. IG17 was last -0.25 basis points to 119.5-120.25 bps, just a shade off Tuesday's 9-week tight of 117.50 bps and the all time series tight of 111.50 bps set on October 27. Meanwhile, the index remains well off the all time series wide of 149.75 bps set on October 3.

Insurance for 5-years on the USA was last flat at 51 bps, which compared to 49 bps a year ago.

Credit slightly outperformed equities as the Dow Jones Industrials were last off 21 points to 12392.

Fed Raskin Q&A:Summary Econ Projctn To Become More'Meaningful'


BALTIMORE (MNI) - From now on, the Federal Open Market Committee will incorporate funds rate forecasts in its Summary of Economic Projections, with the notion the document will "become more meaningful," Fed Governor Sarah Bloom Raskin said Friday.

Answering questions following a luncheon speech to the Maryland Bankers Association First Friday Economic Outlook Forum, Raskin said, "The notion here is that the statement of economic projections is going to become a more meaningful document" since individual FFR projections will now be available.

US Swaptions: OTC Lvls Slips Post NFP, 2Y10Y Premium 7M Lows


CHICAGO, Jan 6 (MNI) - Over-the-counter swaption premiums ground lower with the passing of Friday's better than expected December payroll data.

US$ CREDIT SUPPLY PIPELINE - January 6, 2012


Investment-grade $250M+ Deals Announced/Launched(#)/Priced(*)/Pass(X) Date $MM Issuer/CR/Descr Mat Yield Lead(s) 1/6 1500 *Bank of Montreal (Aa2/A+) 5 T+170 BMO/GS/JPM/MS 1/5 750 *Banco Bradesco (Baa1/BBB) 5 T+361.7 BB/BAML/BRAD/ 144A Reg S w/o Reg Rights BTG/C/HBSC 4.50% 1/5 850 *Pernod Ricard (Baa3/BBB-) 5 T+210 JPM/RBS 101 CoC Put, 144A Reg S 1/5 800 *Pernod Ricard (Baa3/BBB-) 10 T+230 JPM/RBS 101 CoC Put, 144A Reg S 1/5 850 *Pernod Ricard (Baa3/BBB-) 30 T+255 JPM/RBS 101 CoC Put, 144A Reg S 1/5 500 *Bank of Nova Scotia (Aa1/A) 3 3mL+104 BAML/BAR/C/DB/ FRN

Fed Gov Raskin: Labor Mkt Weak;Unconventl Pol Has Been Approp


BALTIMORE (MNI) - Noting the weakness of fundamentals, and labor markets in particular, Federal Reserve Gov. Sarah Bloom Raskin said Friday the "deployment of unconventional policy tools has been completely appropriate to help promote the Federal Reserve's statutory mandate of maximum employment and price stability."

"In that regard, although the pace of employment growth has picked up in recent months and the unemployment rate has fallen some, the labor market remains quite weak," she said in a speech for delivery to the Maryland Bankers Association First Friday Economic Outlook Forum.

Duke Q&A: No Sign Dlrs Created By Fed Causing Infl Press


RICHMOND, Va. (MNI) - Federal Reserve Governor Elizabeth Duke downplayed risks that the Fed's aggressive monetary easing of recent years will lead to higher inflation Friday.

But she vowed that the Fed will be vigilant against higher inflation.

Duke, answering questions following a luncheon speech to the Virginia Bankers Association and the Virginia Chamber of Commerce, said weak loan demand and resource "slack" is so far keeping wage and price increases moderate.

In her text, Duke anticipated inflation will "settle over coming quarters at or below levels consistent with the Federal Reserve's dual mandate."

"In this environment, I believe that the current stance of monetary policy is appropriate," she said.

Fed Gov Duke: Depressed Housing Slows Recovery;Mon Pol Approp


RICHMOND (MNI) - Federal Reserve Governor Elizabeth Duke said Friday the depressed housing market continues to slow the recovery and European financial strains pose "downside risks," but the Fed also faces potential "upside risks," so she did not suggest additional monetary stimulus to help the housing sector.

Monetary policy is "appropriate," Duke said in a speech prepared for delivery to the Virginia Bankers Association and the Virginia Chamber of Commerce. Instead, she echoed a Fed white paper issued Tuesday in suggesting that other non-monetary policy options to help the housing market be explored.

US Tsy Offl: Jobs Rpt Encouraging;Recovery Far From Complete


--Admin 'Deeply Concerned' About Number of Long-Term Unemployed

WASHINGTON (MNI) - The December jobs report had some encouraging news but unemployment measures are far above pre-recession levels and the Obama administration remains "deeply concerned" about the number of workers unemployed for extended periods, a U.S. Treasury official said Friday.

The report, which showed a better-than-expected 200,000 increase in non-farm payrolls and a slight decline in the unemployment rate to 8.5% from 8.7%, "confirmed the recovery continued to strengthen in the second half of 2011," said Jan Eberly, Treasury's assistant secretary for economic policy.