Some also thought perversely that the sharp drop in the price of crude following sign of the strike ending in one region of Venezuela would stimulate the economy. The dollar subsequently collapsed to 38-month lows following comments State Dept's Armitage who said that peaceful solutions to Iraq were just about "exhausted" and Bush leveled criticism at the rogue state.
But, stocks rolled over as well and the March bond closed 10/32 higher at 111-11, while five-year notes outperformed and the curve held its steep profile around +325 basis points. Gold shot up $4 to $358/oz and NYMEX Feb crude gained $1.35 to break above $35/barrel in the end.
The 5% gain in December Housing starts to 1.84 million units was initially ignored.