As all eyes turn to the Federal Reserve and the FOMC announcement on Thursday, the Treasury market may be deserving a greater focus.
Many believe that the Fed wants to see the yield curve for U.S. Treasuries slightly begin to rise, without getting too steep. Tuesday’s decline in bond prices pushes the yield curve (10yr vs. 2yr) below the prior 2015 low set earlier this year and to a level not seen since early 2009…
It’s worth noting, though, that both the 10 year treasury note yield and the 2 year treasury note yield have been rising of late. But the 2 year yield has been rising faster (including a big surge on Monday and Tuesday). Nothing like a little bit of muddy waters into the Fed meeting and announcement.
To hike or not to hike? That question will be answered tomorrow at 2:00 pm EST.
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