Fears that the economy USA weaken at a faster rate and lead to Federal Reserve (Fed) to cut interest rates as early as March led to US bond yields Treasure In 10 years it will be a minimum of three months.
Weak data and dovish comments from some agency officials Fed have sent yields tumbling, with 10-year debt falling from 16-year highs reached in October.
Yields extended their decline on Tuesday after a report showed job openings in USA They hit their lowest level in two and a half years in October. This week’s US data will be closely watched for fresh clues on the strength of the economy, with the November jobs report due out on Friday the main focus.
“The market is comfortable with the idea that the economy is slowing down, consumption is facing headwinds, but they don’t know how much it’s going to slow down,” he said. Ian Lyngen, head of US rates strategy at BMO Capital Markets in New York, told Reuters. “That’s why people are willing to consider a possible rate cut in the first quarter, because the slowdown could be higher than expected,” he added.
Federal funds futures traders Federal Reserve They are pricing the probability that the central bank will begin cutting rates in March, and that rate reductions of 30 basis points will occur through December 2024, at more than 50%.
Benchmark 10-year yields fell to 4.163%, the lowest level since September 1. They have fallen from a 16-year high of 5.021% reached on October 23.
The yield on 30-year debt fell to 4.305%, a low since September 8, while the yield on two-year paper fell to 4.560%, above a low since mid-June reached on Friday.
Source: Ambito
