After the latest U.S. inflation data was released last week, investors expected the Federal Reserve (Fed) to take the most aggressive measures to curb soaring inflation, and the U.S. 10-year bond yield rose above 3.45% on Tuesday (14th). , wrote an 11-year high.
At the time of writing, the U.S. 10-year Treasury yield rose to 3.468%, approaching the 3.5% mark, after falling slightly to 3.44% earlier. The two-year yield rose to 3.425 percent, while the 30-year yield rose 5 basis points to 3.423 percent.
U.S. 10-year Treasury yields have soared since 2.74 percent in May, as fiery inflation data led investors to sell bonds and ramp up bets on sharp monetary tightening by the Federal Reserve. Compared with January 2022, the 10-year U.S. Treasury yield rose sharply by 1.51%.
Advisors Asset Management analyst Cliff Corso said the bond market believes that inflation will continue to run high and may be entrenched.
The surge in U.S. bond yields comes as investors expect the Fed to raise interest rates three yards (75 basis points) this week instead of two (50 basis points) previously forecast, largely on the back of May consumer prices released last month. Index (CPI) rose 8.6% year-on-year, beating market expectations.
The Fed raised interest rates two yards in May, sending 10-year U.S. Treasury yields the biggest gain since 2020, while two-year and 10-year U.S. Treasury yields also briefly inverted for the first time since early April, mainly because investors The central bank is expected to actively tighten monetary policy to reduce inflation. An inverted yield rate is often seen as an indicator of a recession.
At present, the market capitalists are waiting for the Fed’s monetary policy meeting to be held on Wednesday (15th).
