I have tried using both yield curve levels as well as daily moves (absolute change) while doing PCA. Using both types of input/dataset gives me roughly the same shape in terms of principal components matching the empirical observation: parallel shift, slope, butterfly.
For daily moves, I am not doing any centering nor standardization since it should already be centered at 0. For spot rates, given that there's a drift component, are there any preferences into doing either centering or standardization?
I am curious if there are any preferences between using spot levels vs. daily moves as well or are both acceptable. Since I've seen most people doing it on the spot levels only.