In the US bond market on the 10th, there was a scene where the inverted yield of the 2-year government bond yield and the 10-year bond yield was the largest in regarding 40 years. After that, the US consumer price index (CPI) in July was lower than market expectations, and the US Fed’s sharp rate hike speculation receded, and the reversal range narrowed.
Two-year Treasury yields briefly exceeded 10-year yields by more than 58 basis points, according to Bloomberg data. This is the largest since the early 1980s. After that, it was reduced to regarding 41bp. Yields on government bonds generally fell, especially those with shorter maturities, as the prospect of a large interest rate hike receded.
Source: Bloomberg
Swap markets are pricing in a rate hike of regarding 59 basis points at the next Federal Open Market Committee (FOMC) meeting on Sept. 20-21, suggesting a 50 basis point hike is more likely than a 75 basis point hike. Yields on two-year bonds fell nearly 20 basis points to 3.07%.
The U.S. CPI rose 8.5% year-on-year in July, announced on the 10th, slowing from the 9.1% rise in June, which was the first increase in regarding 40 years, and the median forecast of economists surveyed by Bloomberg (up 8.7%). also fell below It was flat compared to the previous month.
US CPI slows more than expected in July, reflecting lower energy prices (1)
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news-rsf-original-reference paywall">Fed Hike Bets Slump After Curve Briefly Hits Four-Decade Extreme(excerpt)
