Treasury yields have started to rise as traders anticipate a lasting increase in rates. This surge is driven by a series of strong data released last week. The 2-year yield, which is particularly sensitive to policy changes, briefly touched 5.101% during Tuesday's morning trading before slightly retreating to 5.088%. If this trend persists, it is expected to reach its highest level since July 25, 2006, at 3 p.m. Eastern time. On that date, the yield closed at 5.114%.
Simultaneously, the 10-year rate also saw an increase as it rose by 2.3 basis points to 4.341%. This signifies its highest anticipated closing level since November 6, 2007.
These shifts in Treasury yields precede an important announcement from the Federal Reserve scheduled for Wednesday. Market observers are almost certain, with a confidence level of 99%, that there will be no change in action.
However, the Federal Reserve is also expected to release updated interest-rate forecasts for the year 2024 and beyond on Wednesday. These predictions are likely to influence future trading and market movements as traders adjust their strategies based on these new insights.
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