Traders across the financial markets will be hyper-focused on Congressional testimony from Fed Chair Janet Yellen Wednesday to see if she has a message that could alter the course for interest rates.
Yields at the long end of the Treasury curve have been falling, taking the dollar lower and making stocks nervous. The move has perplexed traders and strategists, who pin it on a variety of factors. They range from repositioning by investors who became too short bonds; central bank and pension fund buying; relative value to other sovereigns; worries about the economy; and even the sense that the stock market is overvalued.
The 10-year yield Tuesday was at 2.59, close to the bottom of a range its been in since January. Traders will be watching the 1 p.m. auction of $24 billion 10-year notes to see if the market needs to make a concession to attract buyers.