Why did ZB move while ZN did not?

So yesterday (June 6th, 2014), announcements were made for both the 10-year and 30-year note, and I noticed that the 30-year moved quite nicely while the 10-year did not, can someone explain this to me?

thanks in advance

 

Two very different things. It's almost like saying why did wheat move but soybeans didn't?

Different part of the curve so different supply and demand issues.

 

Thanks for replying.
Yes I understand that they are 2 different things, I guess I was just hoping for something a little more in depth

 

If there is a parallel shift in rates, the 30 year will move more than the 10 year (all else equal). You might try searching dv01.

 

thank you

 

ZB will almost always move in greater proportion to the 10 year because of it's longer duration.

 

This type of thing happens quite frequently in the rates; from STIRs to the long duration stuff - especially around any sort of Fed commentary or Auction. Lots of shifting in curve exposure amongst fixed income portfolio managers.

There are many good white papers on the topic in the educational section of the CME website.

 

iraq became more apparent the next trading day when the 30 year auction garnered a lot of demand because that became proxy for safe haven, if ten year was held a day later that auction would have different as well.

Plus, 10-30 big difference with fed meeting next wed in time duration on the risk profile....nobody is putting on a huge position in front of that pivotal meeting in the 10 year unless the shit really hits the fan in iraq.

plus about 5 other factors i will avoid discussing because you need to start doing some of the work.

 

The yield curve is flattening which causes ZB to massively outperform ZN.

Mark Carney, BOE chair flat out said that rate hikes could come earlier than expected, which is rarely said by any central bank chair. This caused a reflexive selloff in shorter maturity bonds, especially the belly of the curve, the 5-7 yr yields.

The Street believes the Long term neutral Fed funds rate will be much lower than before 2008. But they also believe that Fed will raise rates next year, causing short term yields to go up. So the new en vogue trade is the flattener, short the 5 yr and long the 30 yr.

The curve has already flattened tremendously this year, I don't think it can flatten much more unless Yellen hints about faster rate hikes.

 

ZN moves more based on any discretionary decision/comments by Fed regarding interest rates. ZB moves based on any long-term inflationary expectations like CPI report.