• Thu. May 30th, 2024

Investors consider economic data as 10-year Treasury yield drops


Mar 26, 2024

On Tuesday, the 10-year U.S. Treasury yield experienced a slight decline as investors analyzed previous data and looked forward to key inflation figures later in the week. The 10-year yields were unchanged at 4.26%, while the 2-year Treasury yield saw a two basis point increase to 4.61%. In the world of treasuries, yields and prices move in opposite directions, with each basis point representing a 0.01% change.

In the stock market, futures rose early Tuesday after major indexes closed lower the day before. Investors are focusing on assessing the strength of the U.S. economy, potential interest rate cuts by the Federal Reserve, and the number of cuts that might occur this year. The Federal Reserve hinted at rate cuts during its recent meeting, with Chairman Jerome Powell emphasizing the uncertain economic outlook.

Market participants eagerly await the release of the personal consumption expenditures price index on Friday, as it is the Fed’s favorite inflation gauge. Last week, the Fed suggested there would be rate cuts this year, but the exact number remains unclear. While the Fed projected three cuts, Atlanta Fed President Raphael Bostic mentioned he anticipates only one rate reduction.

Deutsche Bank’s Jim Reid noted that recent comments have highlighted the adjustment of end-2024 rate expectations following the FOMC dot plot last week. Economic data released on Monday showed softer results, with new home sales and the Dallas Fed manufacturing index falling below expectations. On Tuesday, data revealed that orders for durable goods in the U.S. increased by 1.4% last month, surpassing economist estimates of 0.8%.

By editor

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