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THE 30-YEAR TREASURY BOND YIELD HITS 5.28%, THE HIGHEST LEVEL SINCE 2007.
The 10-year yield also reaches 4.75%, the highest in 18 months.
The rising term premium is driving this— the additional return investors demand to accept greater risk.
Investors are concerned about future interest-rate hikes.
Fed Chairman Kevin Warsh has sharply reduced guidance on future rate decisions.
Previously, investors used this guidance to estimate where interest rates would go, especially in the short term.
Now they have to price in greater uncertainty.
Inflation adds further pressure. Energy costs are still 14.7% higher than last year, while geopolitical tensions could push oil prices and prices in general back up.
Short-term yields are reacting to the Fed’s unclear policy, while added inflation and policy risks are pushing longer-term yields even higher.
#Pada_Research #tinkinhte
The 10-year yield also reaches 4.75%, the highest in 18 months.
The rising term premium is driving this— the additional return investors demand to accept greater risk.
Investors are concerned about future interest-rate hikes.
Fed Chairman Kevin Warsh has sharply reduced guidance on future rate decisions.
Previously, investors used this guidance to estimate where interest rates would go, especially in the short term.
Now they have to price in greater uncertainty.
Inflation adds further pressure. Energy costs are still 14.7% higher than last year, while geopolitical tensions could push oil prices and prices in general back up.
Short-term yields are reacting to the Fed’s unclear policy, while added inflation and policy risks are pushing longer-term yields even higher.
#Pada_Research #tinkinhte
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