5/4/2017, 11:22 AM (Source: TeleTrader)
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Treasury yields tick higher after Fed decision

The yields on United States government debt rose on Thursday as market participants continued to price in an increase in interest rates in June following the Federal Reserve's meeting on Wednesday.

Even though the US central bank stood pat on monetary policy, it described the slowdown in economic growth during the first quarter as likely to be "transitory," thus setting the stage for a rate hike this summer. The market-assigned probability of that event subsequently climbed to 73.8% from 70.6% recorded the day before. The yield on 10-year Treasuries advanced 1.62 basis points to 2.3342% at 11 am CET, while the yield on two-year bonds grew 1.2 basis points to 1.2059%. The yield on 30-year debt was 1.35 basis points higher at 2.9816%.

Meanwhile, in Europe, the spread between the French and German bonds narrowed further after the centrist Emmanuel Macron was seen as more convincing in the French presidential debate against the far-right candidate Marine Le Pen. The yield on 10-year German Bunds, a benchmark for the Eurozone, jumped 4.1 basis points to 0.367%, while the yield on French bonds of the same maturity rose 2.2 basis points to 0.762%. The yield on the British equivalent was up by 3.4 basis points at 1.107%.

Baha Breaking News (BBN) / IB