FXStreet (Mumbai) – The Fed, via its statement today, gave jobs clue that a rate hike getting closer, however, the Treasury yields do not buy the story.
2-year yield largely unchanged after the FOMC
The 2-year yield, which mimics short-term interest rate expectations, rose slightly to 0.724% in an immediate reaction to the Fed’s statement that rates could rise with some more improvement in the labor market, which has witnessed solid gains off-late.
But the bond traders do not seem to believe in fed’s view, which is evident from the 2-year yield falling back to 0.70%. At the long-end, the 10-year yield rose up to 2.297%, before quickly falling back to 2.27%.
Overall, the action in the treasury yields indicates nothing new has come out of the Fed policy statement released today. As expected the bank maintained interest rates unchanged at record low of 0.25%.
The Fed, via its statement today, gave jobs clue that a rate hike getting closer, however, the Treasury yields do not buy the story.
(Market News Provided by FXstreet)