Yields stay near month highs after Fed job data comments
Updates with speeches by Powell, others, updates prices, changes byline
By Matt Tracy
NEW YORK, Feb 7 (Reuters) -U.S. Treasury yields held near one-month highs on Wednesday as investors digested comments by Federal Reserve officials following a surprisingly strong January jobs report last week.
Addressing the jobs data on Tuesday, Fed Chair Jerome Powellleft the door open for raising the Fed's benchmark interest rate higher than the 5.00% to 5.25% peak range that the central bank anticipated beforethe strong employment showing.
New York Federal Reserve President John Williams on Wednesday noted that the Fed has more work to do on rates, but that he still sees a peak rate of 5.25% as "reasonable" with 25-basis-pointhike increments currently seen as the best path forward.
U.S. employers added 517,000 jobs in January, while the unemployment rate dropped to a 53-year low at 3.4%, the Labor Department reported on Friday. Meanwhile, average hourly earnings increased 0.3% last month after a rise of 0.4% in December.
"What the data did last week was pretty much get the market to start pricing in line with the Fed," said John Madziyire, senior portfolio manager and head of Treasuries and Inflation in the Vanguard Fixed Income Group.
"We're at a point now where, at least relatively speaking, there is more certainty in terms of the path of the Fed, less volatility in terms of expectations for what the Fed's going to do," he added.
Benchmark 10-year yields US10YT=RR were last at 3.657%, after earlier reaching 3.692%, the highest since Jan. 6. They are up from a low of 3.333% on Thursday.
Two-year yields US2YT=RR, meanwhile, were last at 4.454%, after reaching 4.493% on Monday, also the highest since Jan. 6.
The release of the consumer price index report for January
on Feb. 14 will be the next major piece of U.S. economic data.
It is expected to show that headline prices rose 0.5% in the
month, while core prices increased 0.4%. USCPI=ECI, USCPF=ECI
"Looking at where rates are now (up 450basis points) and given the long and variable lags, it makes sense the Fed has now clearly shifted to a more data-dependent pause," said Madziyire.
The Treasury Department sold $35 billion in 10-year notes on Wednesday to strong demand, following a weak sale of $40 billion in three-year notes on Tuesday.
The 10-year notes sold at a high yield of 3.613%, around 3 basis points below where they had traded before the auction. The bid-to-cover ratio was 2.66 times, the highest since February 2022. USAUCTION25
Demand for the three-year notes on Tuesday was likely dented by concerns that Powell would take a more hawkish tone on future rate increases, with his comments coming at the same time as the auction.
The Treasury will also sell $21 billion in 30-year bonds on Thursday.
February 8 Wednesday 3:05PM New York / 2005 GMT
Price | Current Yield % | Net Change (bps) | |
Three-month bills US3MT=RR | 4.59 | 4.7084 | 0.005 |
Six-month bills US6MT=RR | 4.74 | 4.9238 | 0.000 |
Two-year note US2YT=RR | 99-98/256 | 4.4543 | -0.017 |
Three-year note US3YT=RR | 99-184/256 | 4.1006 | -0.021 |
Five-year note US5YT=RR | 98-146/256 | 3.8181 | -0.026 |
Seven-year note US7YT=RR | 98-128/256 | 3.7462 | -0.029 |
10-year note US10YT=RR | 103-224/256 | 3.649 | -0.025 |
20-year bond US20YT=RR | 101-228/256 | 3.862 | 0.000 |
30-year bond US30YT=RR | 105-60/256 | 3.7079 | 0.002 |
DOLLAR SWAP SPREADS | |||
Last (bps) | Net Change (bps) | ||
U.S. 2-year dollar swap spread | 27.25 | 0.25 | |
U.S. 3-year dollar swap spread | 17.50 | 0.75 | |
U.S. 5-year dollar swap spread | 5.50 | 0.25 | |
U.S. 10-year dollar swap spread | -2.75 | 0.00 | |
U.S. 30-year dollar swap spread | -37.50 | -0.50 | |
Reporting by Matt Tracy; editing by Jonathan Oatis
Dernières actualités
Avertissement : Les entités de XM Group proposent à notre plateforme de trading en ligne un service d'exécution uniquement, autorisant une personne à consulter et/ou à utiliser le contenu disponible sur ou via le site internet, qui n'a pas pour but de modifier ou d'élargir cette situation. De tels accès et utilisation sont toujours soumis aux : (i) Conditions générales ; (ii) Avertissements sur les risques et (iii) Avertissement complet. Un tel contenu n'est par conséquent fourni que pour information générale. En particulier, sachez que les contenus de notre plateforme de trading en ligne ne sont ni une sollicitation ni une offre de participation à toute transaction sur les marchés financiers. Le trading sur les marchés financiers implique un niveau significatif de risques pour votre capital.
Tout le matériel publié dans notre Centre de trading en ligne est destiné à des fins de formation / d'information uniquement et ne contient pas – et ne doit pas être considéré comme contenant – des conseils et recommandations en matière de finance, de fiscalité des investissements ou de trading, ou un enregistrement de nos prix de trading ou une offre, une sollicitation, une transaction à propos de tout instrument financier ou bien des promotions financières non sollicitées à votre égard.
Tout contenu tiers, de même que le contenu préparé par XM, tels que les opinions, actualités, études, analyses, prix, autres informations ou liens vers des sites tiers contenus sur ce site internet sont fournis "tels quels", comme commentaires généraux sur le marché et ne constituent pas des conseils en investissement. Dans la mesure où tout contenu est considéré comme de la recherche en investissement, vous devez noter et accepter que le contenu n'a pas été conçu ni préparé conformément aux exigences légales visant à promouvoir l'indépendance de la recherche en investissement et, en tant que tel, il serait considéré comme une communication marketing selon les lois et réglementations applicables. Veuillez vous assurer que vous avez lu et compris notre Avis sur la recherche en investissement non indépendante et notre avertissement sur les risques concernant les informations susdites, qui peuvent consultés ici.
