The yield on the was up by 7 basis points at 4.912%. The yield on the was hovering near the flatline at 5.1%.
US Treasury Yields and bond prices move in opposite directions. One basis point equals 0.01%.
The yield on the 10-year Treasury crossed the 5% mark this past Monday, reaching levels last seen in 2007.
Pershing Square’s Bill Ackman said Monday that he as he believes investors may soon seek safety in bonds as geopolitical concerns mount.
Most Investors have been following the Israel-Hamas war and assessing its potential impact on the global economy, especially the energy sector. Oddly, there has not been a significant run on Treasurys since the war began. During times of geopolitical crisis we would expect rates to fall and bond prices to rise.
The yield on the 10-year Treasury has been steadily climbing in recent weeks and has hit several multiyear highs already this month. Investors we be considering the outlook for interest rates, inflation, and the house congressional mayhem ahead of the Federal Reserve’s next policy meeting on October 31 and November 1st.
A few brilliant Fed officials have suggested that higher Treasury yields will create even tighter financial conditions, which could possibly slow the economy. That could mean the Fed may not need to hike rates again. Based on these statements, many investors to believe rates will be left unchanged next week.
