2023-11-21 11:01:47
U.S. Treasury yields fell on Tuesday (21st) as investors focused on the release of the Federal Reserve’s latest meeting minutes and assessed economic conditions.
5:50 a.m. ET,10-Year Treasury Bond YieldIt fell 1.8 basis points to 4.404%. The 2-year Treasury yield fell 0.2 basis points to 4.909.
Yield and price have an inverse relationship. 1 basis point equals 0.01 percentage point.
On Monday (20th), there was an auction of 20-year government bonds with a total value of US$16 billion. The demand was slightly higher than the average demand, causing the government bond yields to fall.
At the same time, investors assess economic conditions and consider the outlook for the Federal Reserve’s monetary policy, especially interest rates.
Minutes of the Federal Reserve’s latest meeting will be released on Tuesday. At the last meeting, interest rates were kept unchanged. Federal Reserve Chairman Jerome Powell hinted that interest rates may continue to rise, but has not yet discussed a rate cut.
But since that meeting, markets have all but eliminated expectations for further rate hikes as a host of economic data, including October’s consumer price index (CPI), showed inflation was slowing.
According to CME Group’s FedWatch tool, the market expects that the probability of interest rates remaining unchanged for the third consecutive time at the December Federal Reserve meeting is over 99%.
Investors are increasingly questioning when the Federal Reserve will start cutting interest rates and whether the U.S. economy may suffer a recession. Many hope the minutes will provide some clues as to the expected path.
Existing home sales data for October will also be released on Tuesday.
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