|Day's Range||2.2770 - 2.3160|
|52 Week Range||1.9050 - 3.4550|
The New York Federal Reserve bank said it was carrying out up to $75 billion worth of repuchase agreements, or repo, on Tuesday between 9:30 a.m. Eastern to 9:45 a.m. They said the move would help bring back the central bank's benchmark interest rate, or the federal funds rate, back to its target range of between 2% to 2.25%. Market participants have complained this week that a lack of liquidity in funding markets has pushed the fed funds rate above the interest rate on excess reserves, and that the central bank had lost its grip over short-term interest rates. Analysts say the repurchase operations will boost reserves at banks and help ease funding pressures.
This week could see the biggest U.S. bond-market selloff in several years. Traders may be winding down their bullish positions on long-term government debt after a huge rally in recent months, analysts said, while others highlighted more constructive developments on international trade, geopolitics, and the U.S. economy which may be lowering the risk of recession. The 2-year Treasury note yield (BX:TMUBMUSD02Y) is on track Friday for its biggest weekly gain since 2009, after rising 24 basis points this week to trade at 1.769%.
President Trump’s latest Twitter escapade against the Fed calls for negative interest rates to jump-start the slowing economy. But the prospect of using a monetary tool usually reserved for deeply-troubled economies has many strategists on Wall Street seriously worried. Butcher Joseph Asset Management Chief Investment Strategist Nancy Tengler believes the practice of implementing negative interest rates is “seriously dangerous.” The “$16 trillion in negative yielding debt around the globe - I don't understand how you account for it as an investor,” Tengler said in an interview on Yahoo Finance’s The Final Round.
The recent surge in Treasury yields is ravaging a group of market participants that had so far reaped significant gains from the bond-market rally this year.
If you are in the latter camp, let me tell you how you should build a bond portfolio. The best way to build a bond portfolio is to start by thinking about the risks. Yes, I know that U.S. Treasuries cannot technically default (or at least, they haven’t so far).
Bonds in the late 1950s entered a devastating bear market that lasted more than two decades, as bond yields rose by several orders of magnitude — as you can see from the accompanying chart. Many commentators are predicting that this week’s development will presage a similarly devastating bear market for bonds. For insight, I turn to a study into what causes the Treasury yield to be higher or lower than the dividend yield.
Krishna Memani, Invesco’s vice chair of investment, talks to Yahoo Finance’s On the Move about the looming interest rate cuts and inverted yield curve.
To understand how truly President Donald Trump is screwing up financial markets, chew on this: bond funds are outperforming tech stocks.
Long-term Treasury yields jumped after Bloomberg News reported that the U.S. Treasury Department would reach out to market participants on the possibility of issuing ultra-long bonds. The 30-year Treasury bond yield climbed 5.8 basis points to 2.038%. Debt prices move in the opposite direction of yields. The Treasury Department has periodically asked investors about the idea of selling ultra-long bonds with maturities beyond 30 years. Back in 2017, the Treasury asked primary dealers about the potential uptake for bonds ranging between maturities of 40 years to a 100 years.
After falling to an all-time low Wednesday, the 30-year U.S. Treasury bond yield dropped under the 2% level for the first time early Thursday in Asian trading. The longest-dated Treasury bond dropped to 2.06% during U.S. trading, and was last at 1.97%. The 30-year yield's previous all-time low was set in July 2016, when it touched 2.09% after the U.K.'s Brexit vote. Debt prices move in the opposite direction of yields.
The yield for the longest-dated Treasury bond fell to its lowest level in history. Investors said the $22 trillion U.S. government debt market hit this key milestone on a combination of factors including the growing world of negative-yielding government bonds, expectations for Fed easing spurred by rising recession concerns, and the absence of inflation pressures. The 30-year Treasury bond yield (BX:TMUBMUSD30Y) fell to 2.06% on Wednesday, following a relentless rally in long-term government bonds in the past few weeks.
“With a substantial amount of central bank easing already priced, in our view, a marked deterioration in economic data would be required for the rally to continue. Bond yields for leading G-7 rivals were even lower, with Germany’s (BX:TMBMKDE-10Y) and Japan’s (BX:TMBMKJP-10Y) 10-year in negative territory.
U.S. Treasurys on Tuesday dipped back near their lowest levels in more than 2 years after a well-bid note auction showed demand for safe haven U.S. debt and China’s central bank restrained the yuan’s fall to its lowest point in a decade amid the ongoing U.S.-China trade war.
Treasury prices add to a multiday surge on Monday, sending yields to the lowest levels in years, as investors sought havens after China allowed its currency to weaken below a closely watched level, marking an intensification of the U.S.-China trade war.
Traders' expectations for the Federal Reserve to ease policy rose in the fed fund futures market after President Donald Trump announced plans to impose 10% tariffs on the remaining $300 billion worth of imports that have up to now been untouched by levies. Expectations for the Fed to cut rates by 25 basis points at the September meeting of the Federal Open Market Committee climbed to 70.4%, from 48.6% a day ago, CME Group data show. This comes only a day after Fed Chairman Jerome Powell suggested July's 25 basis point rate cut was more of an insurance policy against global economic risks.
Short-dated Treasury yields that are sensitive to monetary policy expectations surged on Wednesday after Federal Reserve Chairman Jerome Powell characterized his 25 basis point rate cut as a mid-cycle policy adjustment. The 2-year Treasury note yield rose 6.2 basis points to 1.910%, spiking as high as 1.944%. Debt prices move in the opposite direction of yields. Powell's remarks appeared to suggest the central bank's rate cut was more of an "insurance" move that would protect the U.S. economy from global risks.
Treasury Secretary Steve Mnuchin says the Trump administration is considering issuing 50 or 100-year bonds, and that there's no plans to intervene in the dollar. Yahoo Finance's Brian Sozzi and Brian Cheung discuss.
Yahoo Finance's Julie Hyman, Brian Cheung, David Nelson of Belpointe Asset Management and Colleen Denzler of Smith Capital discuss.
Stocks tumbled after China said it would impose retaliatory tariffs on U.S. goods followed by Trump ordering U.S. companies to look for ‘alternatives to China.’ Bank of America Senior U.S. Economist Joe Song joined Yahoo Finance’s The Final Round with his take on whether U.S. consumers are feeling the impact from the trade war.
Butcher Joseph Asset Management Chief Investment Strategist Nancy Tengler joins Yahoo Finance's The Final Round to discuss why negative yields are dangerous for markets and whether the inverted yield curve is an indicator of a looming recession.
Investors are worried this morning as bond yields are crashing to near the all-time low of 2.08%. Yahoo Finance’s Brian Sozzi and Brian Cheung discuss if this could point to a recession on the horizon.