The US bond market continues to inverted the yield curve today, with short-term Treasury yields bouncing above long-term Treasuries. which is an indication of the likelihood of an economic recession
The 6-month Treasury yield is near 5%, while the 2-year Treasury yield, which is sensitive to Federal Reserve monetary policy, is near 4% and above Treasury yields. US 10 years old and 30 years old
As of 7:44 p.m. Thai time, the 6-month bond yield was at 4.961%, while the 2-year government bond yield was at 3.956%, and the 10-year bond yield was at 3.361%. The 30-year government bond yield stood at 3.579%.
In the past, the inverted yield curve was often caused by investors selling short-term bonds. and buy long-term bonds Amid concerns about short-term economic conditions Investors are worried that the US economy will be affected by the Fed accelerating interest rate hikes to curb inflation.
Citigroup released a report predicting that The Fed will raise interest rates by 0.25 percentage points three more times this year, bringing it to a maximum range of 5.50-5.75% amid skyrocketing inflation. and a strong labor market
“It’s not only the strong labor market and high inflation that the Fed is less likely to cut interest rates. But we see that inflation continues to be overly strong. Including the release of CPI figures this week that may rebound 0.5% month-on-month. will cause the Fed to raise interest rates several more times,” the report said.
The latest CME Group FedWatch Tool shows investors are 63.4% weighing in on the Fed raising interest rates 0.25% to a range of 5.00-5.25% at its May 2-3 meeting, and 36.6% weighing in. will maintain the interest rate at 4.75-5.00%
Investors see the non-farm payrolls figure in line with analyst expectations. while the unemployment rate decreased Indicates tight conditions in the US labor market. This will be a factor supporting the Fed’s interest rate hike.
According to the US Department of Labor, Nonfarm payrolls rose by 236,000 in March. That was in line with analysts’ expectations of 238,000 jobs.
The unemployment rate fell to 3.5%, while analysts had expected it to hold steady at 3.6%.
In addition, the US Department of Labor has increased the number of jobs in February. Adjusted to an increase of 326,000 positions from the previously reported increase of 311,000 positions.
Investors keep an eye on inflation numbers. Including the minutes of the Fed meeting that will be released on Wednesday, April 12, where the US will release the consumer price index (CPI) for the month of March. Including the minutes of the Fed’s monetary policy meeting on March 21-22 on that date.