Home » Markets and Fed: 10-year Treasury yields well below 4% after Inflation Day collapse

Markets and Fed: 10-year Treasury yields well below 4% after Inflation Day collapse

by admin
Markets and Fed: 10-year Treasury yields well below 4% after Inflation Day collapse

Rates on 10-year US Treasuries are up, but remain well below the 4% threshold, pierced the day the US CPI index was published in October.

The data highlighted an increase in inflation on an annual basis, of 7.7% on an annual basis, from the previous rise of 8.2% in September and compared to the + 8% expected by the consensus. Investors immediately bet on the arrival of less aggressive tightening maneuvers by the Fed of Jerome Powell in the meeting in mid-December, after four consecutive hikes of 75 basis points since the beginning of the year.

The euphoria was such that Treasury rate yields plummeted by more than 30 basis points.

10-year Treasury rates are up slightly to 3.681% while 2-year Treasury rates are up to 4.412%.

On November 2, the Fed raised rates by 75 basis points, taking them from the range between 3% and 3.25% to the new range between 3.75% and 4%, a record value since 2008.

A warning not to believe too much that the Fed’s battle against inflation is coming to an end came yesterday from Fed Governor Christopher Waller.

Waller said the fact that the US central bank could raise rates at a slower pace at the next FOMC meeting – its monetary policy arm – should not be interpreted as a possible imminent decision by the institution to lay down its arms in countering. the flares of inflation:

“Stop paying attention to the speed (of hikes) and start paying attention to what the final rate (terminal rate) will be. Until we can bring inflation down, the end (of monetary tightening) will remain far away, ”Waller stressed.

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy