US Treasuries Fall Ahead of FOMC Minutes

Treasuries fell for the first time in three days, with 30-year yields rising from a 17-month low, before the Federal Reserve releases minutes of its latest policy meeting.

Benchmark 10-year yields increased from the lowest level in more than five weeks as the U.S. prepares to sell $21 billion of the securities. Central bank officials raised their median estimate for the federal funds rate for the end of 2015 during last month’s meeting, while keeping their pledge to maintain it at almost zero for a “considerable time” after bond-buying ends. Government bonds surged around the world yesterday as the International Monetary Fund cut its global-growth outlook.

“People are starting to prepare for” the 10-year auction, said Michael Franzese, senior vice president of fixed-income trading at ED&F Man Capital Markets in New York. “The Fed will stand pat on its belief that interest rates will stay low for a long period of time.”

The U.S. 10-year yield rose one basis point, or 0.01 percentage point, to 2.35 percent at 9:15 a.m. New York time after reaching 2.33 percent, the least since Aug. 29, according to Bloomberg Bond Trader data. The 2.375 percent note due August 2024 fell 2/32, or 63 cents per $1,000 face amount, to 100 7/32.

The yield on the 30-year bond dropped earlier to 3.04 percent, the lowest level since May 2013.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza