US Treasury yields hold steady as investors await Powell comments

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U.S. government debt yields held steady Thursday as fixed-income investors awaited comments from Federal Reserve Chairman Jerome Powell.

Symbol
Yield
Change
%Change
US 3-MO 2.422
0.01 0%
US 1-YR 2.535
UNCH 0%
US 2-YR 2.467
-0.012 0%
US 5-YR 2.444
-0.014 0%
US 10-YR 2.634
-0.02 0%
US 30-YR 2.976
-0.03 0%

The yield on the benchmark 10-year Treasury note, which moves inversely to price, was slightly lower at 2.71 percent, while the yield on the 30-year Treasury bond was also slightly lower at 3.01 percent. The 2-year yield held steady at 2.55 percent.

Fed Chairman Jerome Powell is set to address the Economic Club of Washington in a panel talk Thursday afternoon. The central bank chief is likely to discuss the path of monetary policy as well as the state of the economy and will participate in a Q&A session.

The Fed raised its benchmark overnight lending rate four times in 2018 as a part of its goals of maximizing employment and keeping prices in check. Powell and his colleagues have cited months of strong labor statistics and healthy GDP numbers while hiking rates.

However, tepid inflation and concerns surrounding the longevity of the current economic expansion have prompted backlash from some market participants. Fears that policymakers may be elevating borrowing costs at too quick a pace contributed to a broad stock sell-off in the fourth quarter of 2018, with both the Dow Jones Industrial Average and the S&P 500 posting their worst Decembers since the Great Depression.

The Treasury Department auctioned $16 billion in 30-year bonds at a high yield of 3.035 percent. The bid-to-cover ratio, an indicator of demand, was 2.19. Indirect bidders, which include major central banks, were awarded 57.3 percent. Direct bidders, which includes domestic money managers, bought 15.9 percent.

China’s commerce ministry said Thursday the negotiations were extensive and had helped set up a foundation for further talks. This week’s face-to-face meetings were the first to take place since U.S. President Donald Trump and Chinese President Xi Jinping agreed to a 90-day truce last month.

If both sides are unable to secure a comprehensive trade agreement by March 2, Trump has said he plans to raise tariffs to 25 percent from 10 percent on $200 billion worth of Chinese imports.

[“source-cnbc”]