Treasury Yields Rising Ahead of FOMC Meeting, First Positive Move In 3 Days

Treasuries fell, pushing the 10-year yield up from near a two-month low, before the Federal Reserve begins a two-day meeting tomorrow and the U.S. sells a combined $111 billion of notes and floating-rate debt this week.

The benchmark 10-year rate rose for the first time in three days before a report economists said will show a gauge of home sales declined for a second month in December. The 10-year note yield will rise to 3.37 percent by Dec. 31, according to the weighted average estimate in a Bloomberg survey of analysts. The Fed decided in December to reduce its monthly bond buying to $75 billion from $85 billion, starting in January.

“I’m kind of cautious of Treasuries at these levels because they may be a little bit too rich,” said Kei Katayama, a Tokyo-based money manager at Daiwa SB Investments Ltd., which oversees the equivalent of $48.2 billion. “The basic fundamentals of the U.S. are still healthy. At some stage, I’m expecting some pickup in the yield.”


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu