2024-01-02 10:44:59
U.S. Treasury yields climbed on Tuesday (2nd) as 2024 trading kicked off, and questions remained regarding the outlook for interest rates and the state of the economy.
5:08 a.m. ET,10-Year Treasury Bond Yieldrose 8.3 basis points to 3.943%. The 2-year Treasury yield rose 5.6 basis points to 4.306%.
Yields and prices move in opposite directions, with 1 basis point equal to 0.01 percentage points.
2023 is shaping up to be a tumultuous year for bond markets.10-Year Treasury Bond YieldIt rose to above 5% in October and fell below 3.9% at the end of the year.
Market shocks such as rising interest rates, persistent inflation, recession fears, and U.S. regional banking crises are factors affecting the bond market in 2023, and some of these factors may also have a significant impact in the year ahead.
The market is generally expecting the Federal Reserve to end its interest rate hike cycle, and the Federal Reserve has kept interest rates unchanged at the past three meetings. Rate cuts are expected to begin in 2024, with the Fed saying it expects three rate cuts, but when and how much remains unclear.
Even following these initial cuts, interest rates will remain elevated, raising concerns regarding how they will affect the economy and whether the U.S. will slip into recession this year.
Investors will get new insights into labor market conditions with the release of JOLT job openings on Tuesday, the ADP private employment report on Wednesday (3rd), and the December employment report on Friday (5th).
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