The yield on US Treasury bonds rose moderately, while market participants continue to assess the impact of the latest tightening of the Fed's monetary policy and expect the publication of US data.
The yield on 5-year Treasury bonds rose by 3.6 basis points, reaching 3.963%, while the yield on 30-year bonds was 3.640% (+0.2 basis points). Meanwhile, the yield on 2-year Treasury bonds, reflecting expectations of short-term interest rates, increased by 4.2 basis points to 4.169% (the highest level since October 2007), while the yield on 10-year bonds increased to 3.721% (+1.3 basis points), reaching more than 11-year high. 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 45 basis points.
As for the US data, at 13:45 GMT will be released business activity indices in the manufacturing sector and the service sector for September, which are used as a key indicator of inflation and recession, since they reflect supply and demand, as well as expansion or contraction of activity. Economists expect the manufacturing PMI to fall to 51.1 from 51.5 in August, while the services PMI rose to 45.0 from 43.7.