June 10, 2022 | Daily JAM |
The yield on the 10-year Treasury climbed 12 basis points today to 3.16%. The yield on the 30-year Treasury rose to 3.20% from 3.17% yesterday, June 9. The yield on the 5-year treasury reached 3.25%, up from 3.07% yesterday and above the yield on the 10-year maturity. The yield on the 2-year Treasury, which tends to be the most sensitive maturity to increases in the Federal Reserve’s short-term benchmark interest rate, climbed to 3.06% from 2.82% yesterday. In light of the 8.6% annual CPI inflation rate announced today, bond traders increased their bets on a 75 basis point interest rate hike from the Federal Reserve at both its June 15 meeting (that’s next Wednesday) and at the July 27 meeting.
April 6, 2022 | Daily JAM, Morning Briefing |
Money markets are pricing in another 225 basis points of increases to the Federal Reserve’s benchmark interest rate by the end of 2022. That’s on top of the 25 basis point increases already delivered in March. The Fed hasn’t done that much tightening–a total of 2.5 percentage points–in one year since 1994.
April 5, 2022 | Daily JAM, Morning Briefing, Short Term, You Might Have Missed |
In remarks prepared for a Tuesday speech to the Minneapolis Federal Reserve Bank Federal Reserve Governor Lael Brainard said “Currently, inflation is much too high and is subject to upside risks. The committee is prepared to take stronger action if indicators of inflation and inflation expectations indicate that such action is warranted.” And she called for reducing the Fed’s balance sheet as early as next month. The bond market certainly heard Brainard’s remarks as a promise of more action faster.
March 29, 2022 | Daily JAM, Morning Briefing |
Yesterday, March 28, a substantial piece of the Treasury yield curve fell into inversion. The yield on the 5-year Treasury climbed to 2.57%. Which put it above the yield of both the 10-year Treasury at 2.46% and the 30-year Treasury at 2.55%.
December 11, 2021 | Daily JAM, Short Term |
The Federal Reserve’s Open Market Committee meets on Wednesday, December 15, and that the central bank’s interest rate setting say something about the speed at which it will wind down its monthly purchases of Treasuries and mortgage-backed securities. We’re pretty sure, but we don’t know with absolute certainty, that the Fed will announce a speed up of that wind down that would see the process of ending all of the Fed’s monthly purchases a month two early. June, maybe. That could be a big deal because the financial markets are convinced that the Fed would have to end its purchases of Treasuries before beginning any interest rate increase in, say, the last quarter of 2022. I think, but I’m certainly not positive, that the markets won’t show much reaction to the news
July 13, 2021 | Daily JAM, Morning Briefing, Short Term |
The Federal Reserve has said that the current jump in inflation is temporary, a result of post-pandemic glitches in the supply chain. So far the market is going along with that view. But huge jumps in monthly inflation in May and now, this morning, June are treating that confidence.
The consumer price index (CPI) rose 0.9% in June from May and by 5.4% from June 2020, according to the Labor Department today. Excluding more volatile food and energy components, core CPI inflation rose by 4.5% from June 2020. That’s the biggest jump in core inflation since November 1991.
February 25, 2021 | Daily JAM, Morning Briefing |
Yields on U.S. Treasuries hit 1.61% early today before pulling back slightly to 1.51% as of 3 p.m. New York time. It’s not just the rise in yields or even the magnitude of the increase that has so disconcerted the bond market today, February 25. It’s the speed of the move. As of 3 p.m., the bond market was looking at a 14 basis point increase in yields just today. That’s a huge move for the normally slow-moving bond market.
February 9, 2021 | Daily JAM, Dividend Income, IEF, Jubak Picks, Perfect Five-ETFs, VGIT, Volatility |
A year ago, the yield on the 10-year Treasury note stood at 1.59%. From that point yields fell, leading to big gains for Treasuries and other bonds. Yields were down to 0.73% as of the week of April 15, 2020. And then hit their low for 2020 during the week of August 2 at 0.55%. Since then the story for long Treasuries has been just the reverse. By October 4, the yields on 10-year Treasuries were back ump to 0.78%. 0.83% by November 1. 0.93% on December 6. And then 1.16% today February 9. The forecast right now is that yields for long Treasuries aren’t done climbing either.
August 27, 2019 | Daily JAM, Morning Briefing, Short Term, Volatility, You Might Have Missed |
This morning you could hear the gears whirring as Wall Street strategists tried to position their portfolios so they were hedged against U.S-China trade war risk but also positioned to catch any bounce on good news on the trade front and ahead of the September 18...
August 22, 2019 | Daily JAM, Morning Briefing, Short Term |
The financial markets aren't backing off. They're pricing in high odds of another 65 basis points to 75 basis points in interest rate cuts by the end of 2019. That means a 25 or 50 basis point cut at the September 18 meeting followed by another 25 to 50 basis point...
August 15, 2019 | Daily JAM, Morning Briefing, Short Term, You Might Have Missed |
Retail sales in July climbed 0.7% from June. Economists surveyed by Briefing.com had predicted a 0.3% climb. Retail sales excluding autos were up 1.0% month over month. Economists had projected a 03% gain.. Nonstore retail sales (that is the Internet) were up 2.8%...
August 14, 2019 | Daily JAM, Morning Briefing |
As of noon today New York time, the Standard & Poor's 500 and the Dow Jones Industrial Average are both down 2.42%. The NASDAQ Composite is lower by 2.78%. The Russell 2000 small cap index has tumbled 2.66%. And the iShare MSCI Emerging Markets ETF (EEM) has...
