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Ekonomické zprávy

US bond yields show a slight change ahead of the publication of inflation data

The yield on US Treasury bonds shows mixed dynamics, while market participants are preparing for the publication of April US CPI data, which may cause a reassessment of the prospects for the Fed's monetary policy.

The yield on 5-year Treasury bonds rose by 0.1 basis points, reaching 3.496%, while the yield on 30-year bonds was 3.824 (-2.5 basis points). Meanwhile, the yield on 2-year Treasury bonds, reflecting expectations of short-term interest rates, rose by 2.7 basis points to 4.051%, while the yield on 10-year bonds fell to 3.507% (-1.5 basis points). The curve between the 10-year Treasury yield and the 2-year yield remains inverted, sending a warning that the economy may be falling or has already fallen into recession. Now the gap between 10 and 2 year U.S. debt is 54 basis points.

As for inflation data, experts expect CPI growth accelerated to 0.4% from 0.1% in March, but in annual terms, the CPI increased by 5%, as in March. As for the core CPI, economists expect an increase by 0.4% on a monthly basis and by 5.5% per annum. In March, the core CPI rose by 0.4% and 5.6%, respectively. Economists note that today's data may become the basis for future decisions of the Fed on monetary policy, especially on interest rates. Yesterday, the president of the Federal Reserve Bank of New York, John Williams, suggested that the Fed could continue tightening policy if inflationary pressure does not ease. According to the CME FedWatch Tool, markets see an 84.5% chance that the Fed will leave rates unchanged at the June meeting, and a 15.5% chance of a 0.25% rate hike.

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