|Day's Range||2.3080 - 2.3340|
|52 Week Range||2.2940 - 3.2480|
Treasury investors are pricing in a rate cut by the end of the year, but the minutes of the Fed’s May policy meeting released last Wednesday showed officials expect patience on rates to be appropriate for “some time.”
Rates for home loans fell again, in what should be a bonus for home shoppers, if they could find homes to buy and scrape together a down payment.
Speculators' net bearish bets on U.S. 10-year Treasury note futures rose to their highest in more than six months earlier this week, according to Commodity Futures Trading Commission data released on Friday. ...
Treasury prices fall Friday, pushing yields higher, as U.S. equities look to recover from the previous session’s slump, sapping appetite for government paper.
Orders for durable or long-lasting goods fell 2.1% in April, largely because of falling demand for Boeing airplanes and new cars and trucks. Business investment also continued to weaken, reflecting worries about the China trade fight and a slower U.S. economy.
Long-term government debt yields were set to finish the week near multiyear lows, held down by mounting concerns that the trade war between the U.S. and China could persist longer and curb GDP growth more than first thought. The yield on the 10-year Treasury note posted a marginal gain in Friday's session after falling 10 basis points to a low of 2.292% on Thursday, its lowest level since Oct. 16, 2017. The U.S. and China have imposed tariffs on billions of dollars' worth of one another's goods since the start of 2018, battering financial markets and souring business and consumer sentiment.
Investors tracked by the CME Group’s FedWatch tool believe central bank policymakers are more likely than not to cut rates at least once by December 2019.
The Fed might not cut rates soon and PMI has slipped. The Dow Jones Industrial Average lost 1.11% to close at 25,490.47. The S&P 500 tumbled 1.19% to end at 2822.24, and the Nasdaq Composite has dropped 1.58% to close at 7628.28.
Treasury prices surge on Thursday as nervous investors face signs of economic weakness abroad and the possibility that U.S.-China trade tensions may last longer than anticipated.
Stocks slumped on Wall Street Thursday, handing the market its second straight loss, as investors worried about an apparent stalemate in trade talks between the U.S. and China.
The 10-year Treasury yield temporarily fell below 2.30% after a dramatic rally in the bond market sent yields for government paper lower. The 10-year yield traded at 2.304%, after touching an intraday nadir of 2.294%. The 2-year note yield fell 10 basis points to 2.07%, while the 30-year bond yield slipped 8.6 basis points to 2.733%. Debt prices move in the opposite direction of yields. Bond investors are showing increased conviction that global growth concerns, subdued inflation and trade uncertainty will push the Federal Reserve to cut interest rates this year. The slump in stocks was also driving market participants into the safety of government paper, with the S&P 500 and the Dow Jones Industrial Average down more than 1% on Thursday.
The Arms Index, a volume-weighted measure of market breadth, suggests that despite the stock market's broad and sharp declines on Thursday, the unwind appears to be orderly. The so-called Arms Index tends to rise above 1.000 when the broad market declines, as the ratio of volume in declining stocks over advancers tends to rise relative to the ratio of the number of declining stocks to advancers, as sellers become more aggressive than buyers. A reading of 2.000 or higher is viewed by many as signaling panic. However, the NYSE Arms was at just 0.904 and the Nasdaq Arms was at 0.632, although the Dow Jones Industrial Average [: DJIA] tumbled more than 400 points, or 1.6%, at 25,357, and the Nasdaq Composite Index shed 2% at 7,602. The S&P 500 index was off 1.6% at 2,810, late afternoon Thursday. Currently, declining stocks were 2,320 versus 484 advancers on the NYSE, roughly the same ratio on the Nasdaq. Moves for stocks came as the benchmark 10-year Treasury note yielded 2.30%, falling to its lowest level since December of 2017. Heightened fear of trade war, which could disrupt economic growth was at the heart of the selloff. The relatively placid selling, however, could, perhaps, be pegged to a Memorial Day holiday, with markets in the U.S. set to be closed.
Both a tight labor market and concern among businesses about their profit margins should boost inflation as the year unfolds, San Francisco Fed President Mary Daly said on Thursday. In an interview with the Fox Business Network, Daly said she expects inflation to move to the Fed's 2% target, but not above that level. After hovering just below 2% last fall, the Fed's favorite measure of core inflation, the personal consumption expenditure index, fell to a 1.6% annual rate in March. Daly said she expects a tight labor market and steady, if subdued, growth will continue to push up wages, and this will put some upward pressure on prices. At the same time, businesses are "starting to think" about passing along "certain" price increase to customers to protect their profitability, she said.
Trade tensions, global growth fears and expectations for policy easing have all combined to bring the all-important 10-year Treasury yield to a 1 ½-year low.
FT subscribers can click here to receive Market Forces every day by email. Trade-sensitive sectors, or those with complex global supply chains, are feeling the heat as the sun shines brightly in London today.
U.S. government debt prices were higher Friday morning, as investors prepared for a deluge of economic data and Treasury auctions.
The yield on the 30-year Treasury bond fell to its lowest level in more than 16 months on Thursday as Wall Street grew confident that the trade disagreement between the U.S. and China could drag on longer than initially thought. At around 8:32 a.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was lower at around 2.361%, while the yield on the 30-year Treasury bond was also lower at around 2.785%. The latest disagreement between Washington and Beijing worsened after U.K.-based semiconductor designer Arm Holdings said it suspended business with Huawei to comply with the U.S. blacklisting of the telecom company.
Foreigners increased their purchases of U.S. 10-year Treasury notes in early May in a lacklustre auction that had stoked speculation China was cutting back on buying in retaliation for the threat of sharply higher U.S. tariffs on Chinese goods. China, which is the largest foreign holder of U.S. government debt, had $1.121 trillion worth of Treasuries at the end of March, Treasury data showed. The Treasury Department’s auction allotment data do not offer a breakdown of foreign purchases by countries.
Treasury prices rise Wednesday, pushing yields lower, as Brexit uncertainty draws investors into haven assets, following reports that U.K. Prime Minister Theresa May is facing a potential coup.
Dallas Fed President Robert Kaplan said Wednesday that he is solidly in the "patient" camp on interest rates and had no position on whether the next interest rate policy move will be to ease or tighten. Asked on the Fox Business Network if the next move by the Fed would be a rate cut, Kaplan replied: "We're basically, I think, at the right policy setting. I'm sort of agnostic at this point between about moving rates up or down." Kaplan said he would need to see something "compelling" that would cause him to end this patient stance. Financial stability concerns was one reason not to cut rates now, he said. "I'm hesitant while we're at or past full employment and the economy is running at solid rates... that adding further accommodation to the economy could create excesses and imbalances that could be painful to deal with in the years ahead," Kaplan said. While he is not a voter, Kaplan is influential given that he is a member of a small subcommittee of Fed officials that focuses on communication strategy.
The voting members of the Federal Open Market Committee seemed comfortable with their patient stance on interest rate, agreeing it could last for "some time," according to minutes of their April 30- May 1 meeting released Wednesday. Even if global economic and financial conditions improve, a wait-and-see approach was warranted, the officials said. Officials were split on the outlook for interest rates. A few officials said there might be a need for higher rates if the economy evolves as they thought. But others thought higher productivity might mean there was more economic slack than the low unemployment rate might suggest. Several others expressed worry about the risk of low inflation readings leading to lower expectations of future inflation, but did not call for a rate cut. Many said that the recent low inflation readings were transitory. In addition to interest-rate policy, there was a lengthy discussion, but no decision, about what types of Treasurys the central bank should hold once its balance sheet stops shrinking.
U.S. government debt prices were slightly higher Wednesday morning, as investors await the minutes of the Federal Reserve's latest meeting.
The International Monetary Fund is out with a study, stating that U.S. tariffs on Chinese goods have been mostly paid for by American importers. James Liu, Clearnomics Founder & CEO and Ashley Feng, Researcher at the Center for a New American Security, join Seana Smith on 'The Ticker' to discuss
Federal Reserve officials remain “patient”, saying rates will likely remain unchanged well into the future. Frances Stacey, Optimal Capital Director of Strategy, joins. Seana Smith on 'The Ticker' to break down the recent FOMC minutes and what lies ahead for the U.S. economy.