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Treasury yields are one inch higher than U.S. GDP reports, unemployed claims

US Treasury yields rose Thursday as bond investors prepared a report on second-quarter economic growth and weekly unemployment claims that are expected to provide insight into the state of recovery from COVID-19. did.

What is the yield doing
  • 10-year government bond yield
    TMUBMUSD10Y,
    1.266%

    It was 1.269%, compared to 1.259% at 3:00 pm on Wednesday. As prices go down, debt yields go up.

  • 30-year government bond interest rate
    TMUBMUSD30Y,
    1.911%

    It was 1.920% compared to 1.910% one day ago.

  • Treasury Securities Yield for 2 Years
    TMUBMUSD02Y,
    0.211%

    It was 0.215%, compared to 0.209% on Wednesday.

Bond driver

The bond move on Thursday is the monthly purchase of $ 120 billion worth of bonds, with Federal Reserve Board Chairman Jerome Powell showing on Wednesday that the central bank could begin tapering soon. After stating that it is heading towards curtailing financial support during times of crisis, including, it emphasizes that changes will be telegraphed and gradually implemented.

“It’s not currently on the radar screen,” Powell said at a press conference Wednesday to discuss the Fed’s latest policies.

Some analysts believe the Fed has set the stage for a rollback of mitigation policies by the end of 2021. Signal their intentions.

On Thursday, investors Second quarter gross domestic product analysis revision 8:30 am Eastern Standard Time. Economists surveyed by The Wall Street Journal predict that gross domestic product will increase by 9.1% annually in the second quarter. This is one of the biggest growth ever.

A weekly unemployment allowance claim to replace the layoff will also be issued at the same time.Investors monitor reports on pending home sales at 10am

U.S. stock index Mostly high on Thursday, Hong Kong’s puzzled Hang Seng Index
HSI,
+ 3.30%

The index rose 3.3% significantly after being pressured by China’s regulatory crackdown focused on People’s Republic-based tech companies.

Overseas, Germany’s 10-year yield
TMBMKDE-10Y,
-0.435%
,
Known as The Bund, it trades at around -0.434%, marking the lowest level since February.

Global yield declines, with US Treasury yields trading at their lowest in about four months, and the strength of the economic recovery from COVID-19 amid the surge caused by the delta mutation in the coronavirus. This is due to growing concerns about.

In addition, inflation-adjusted yields, or real yields, Trading at or near record lows.. The 10-year Treasury Inflation Protection Securities (TIPS) yield reached -1.15% on Wednesday, and Germany’s equivalent TIPS yield hit a record low of -1.797%.

Investors may also be monitoring the receipt of a $ 62 billion auction of Treasury securities for seven years
TMUBMUSD07Y,
1.021%

1:00 pm Eastern Standard Time.

Meanwhile, a bipartisan senator group Infrastructure package of about $ 1 trillion, Bond investors carefully monitor the potential impact on bond issuance to fund the initiative. NS The Wall Street Journal Report Completing an infrastructure package that will provide about $ 550 billion in spending above the expected federal level is the first step the Democrats want to take to approve much of President Biden’s agenda.

What strategists and traders are saying

“When the 30-year yield rose to an area of ​​1.98% / 2%, we continued to support the purchase of dips,
The 10-year yield will rise to the 1.35% / 1.38% range, “said Tomdi Galoma, Managing Director of Treasury Securities at Seaport Global Securities, in his diary.

“We read the July FOMC statement and Powell’s press conference as a guide against the September taper decision, but the taper decision will be made in November or December and may begin to taper around the end of the year. That’s what the top staff of Evercore ISI and the former Fed said in a research note on Thursday.

“The actual 10-year post-conference yield reached a new low of minus 118bp. There may be a Rorschach test here. Some markets are against the September taper. While the guidance gives the dovish reassurance, some are showing bright growth, while others are looking at additional causes of concern that the Fed is not paying too much attention to the downside. It should be, and it could still be withdrawn too early to secure strong nominal growth in the medium term, “Guha wrote.

Treasury yields are one inch higher than U.S. GDP reports, unemployed claims

Source link Treasury yields are one inch higher than U.S. GDP reports, unemployed claims

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