Home Business Throw Treasuries post Fed: 2-year rates jump over 4.2%, a new record since 2007. Keep an eye on 10y yields too

Throw Treasuries post Fed: 2-year rates jump over 4.2%, a new record since 2007. Keep an eye on 10y yields too

by admin

The boom in US Treasury yields continues, with two-year yields, which are the most sensitive to the Fed’s monetary policy decisions, which have jumped even more than 4.2%, positioning themselves at the record of the last 15 years, or since 2007 , equal to 4.266%. At the moment they continue to run, reporting a jump of 12 basis points, to 4.246%

To price the scenario of further aggressive monetary tightening, in addition to equities, it is therefore also the fixed income market. Boom also for 10-year Treasury yields, up to 3.801%, near the highest levels since 2011.

The rate boom was triggered by the Fed’s decision by Jerome Powell, the day before yesterday, Wednesday 21 September, to raise US fed funds rates by 75 basis points for the third consecutive time, to the range between 3% and 3.25%, with the aim of stopping galloping inflation.

The dot plot also revealed that the Fed intends to remain aggressive, bringing interest rates up to 4.6% in 2023 and 4.4% by the end of this year.

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