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Saturday, October 23, 2021

U.S. 10-Year Treasury Yield Hits Near 4-Year High Above 2.7%

U.S. 10-Year Treasury Yield Hits Near 4-Year High Above 2.7%© Reuters. U.S. 10-year treasury yield hits near 4-year high

Investing.com – U.S. government debt yields rose on Monday, with the benchmark 10-year note hitting its highest level in almost four years, while the U.S. dollar recovered somewhat from last week’s turbulence, prompted by conflicting comments from the Trump administration at Davos.

The benchmark hit an intraday high of 2.712%, a level not seen since April 2014. It was last at 2.708% by 4:30AM ET (0930GMT), up 4.6 basis points, or roughly 1.8%.

The benchmark yield has not been above 3% since late 2013 and some investors believe that level will be tested in the months ahead amid expectations that an economy boosted by tax reform will compel further policy tightening from the Federal Reserve this year.

The yield on the Fed-sensitive edged up 3.7 basis points, or 1.7%, to 2.156%, its highest since Oct. 2008.

Meanwhile, the yield on the was also higher at 2.948%.

Bond yields move inversely to prices. One basis point is equal to one hundredth of a percentage point.

The , which gauges the U.S. currency against a basket of six major rivals, rose almost 0.3% to 89.10, extending its rebound from a three-year nadir of 88.25 set on Thursday.

The greenback fell last week following comments from U.S. Treasury Secretary Steven Mnuchin about how a weaker currency benefits trade. The currency later edged up after President Donald Trump said Mnuchin had been misinterpreted, but subsequently resumed its slide.

Global financial markets will Federal Reserve policy meeting, which will be the last under the leadership of Janet Yellen before she hands the chairmanship over to Jerome Powell.

There are also some major data releases in the coming week, as the calendar rolls to February from January, with Friday’s monthly employment data in the spotlight.

The majority of economists believe that the Fed will hike rates in March, followed by another hike in June, with a third move higher arriving in December.

Another headliner this week will be President Donald Trump’s State of the Union address on Tuesday. The theme of Trump’s address will be “building a safe, strong and proud America,” a senior administration official told reporters on Friday.

According to the White House, the speech will focus on five main policy areas: jobs and the economy, infrastructure, immigration, trade and national security.

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Source: Investing.com

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