The Commitment of Traders report from last week showed some strange developments toward the 30-day Treasury bill and the five-year Treasury note.

The large speculators are net short on the 30-day Treasury bill for the first time in the last year. When we see a net short position, this indicates selling pressure. When there is selling pressure on the bills, the interest rate on the bills rises.

Conversely, large speculators have built the biggest net long position towards the five-year Treasury note in the past year. In an opposite reaction to the selling pressure on the bills, the notes are seeing buying pressure which drives the yield down.

The combination of these two developments is an odd phenomenon.

What it suggests is that investors expect rates to remain low on the intermediate term notes and perhaps don’t see interest rates rising on the short-term bills anytime soon.

Given the recent series of weak economic news, it is looking less likely that a rate hike from the Fed is in the works anytime in the near future. As a result investors are willing to buy the five-year note and lock in a higher yield.