US Tsy’s Little Changed – FED Taper In Focus

Treasuries fluctuated as the Federal Reserve started a two-day meeting, with economists forecasting policy makers will scale back their monthly debt-buying program.

Benchmark 10-year note yields erased losses even as economists forecast a May 2 report will show faster jobs growth this month. The central bank is forecast to cut its monthly purchases to $45 billion from $55 billion when its meeting ends tomorrow, based on a Bloomberg News survey of banks and securities companies. The U.S. will sell $15 billion of two-year floating-rate securities today.

“You take the Fed at its word, but it’s always evolving.” Michael Franzese, senior vice president of fixed-income trading at ED&F Man Capital Markets in New York. “Their finger’s on the scale and depending on how they press it down or lift it up determines which direction the market’s going to go.”

Benchmark 10-year yields were little changed at 2.70 percent at 11:17 a.m. New York time, according to Bloomberg Bond Trader prices. The 2.75 percent note due in February 2024 traded at 100 13/32. The yield climbed four basis points yesterday, the first increase since April 17.

Bloomberg

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell