Treasury note futures rose as comments from Federal Reserve Vice Chairman Stanley Fischer fueled speculation the central bank may push back the timing for raising interest rates.
Money-market derivatives signal that the central bank won’t increase its almost-zero policy rate target until the fourth quarter of 2015. While the Fed is set to end its bond-buying this month, the prospect of monetary tightening has been tempered by concern regarding flagging global economic growth.
“Most of the trade overnight has been driven by three-factors, a pretty dour round of International Monetary Fund meetings in Washington this weekend, accented we think by Fed Vice Chair Stanley Fischer’s comments Saturday afternoon,” said John Brady, managing director for global futures and options at RJ O’Brien & Associates LLC in Chicago. “Considering Tokyo was closed last night, overnight volumes in Treasury futures was quite heavy.”
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