U.S. bond yields were mixed on Wednesday, as investors waited for the minutes of the latest Federal Open Market Committee meeting and a big batch of economic data to be published ahead of the Thanksgiving Day holiday.
What’s happening?
-
The yield on the 2-year Treasury note
TMUBMUSD02Y,
4.537%
rose 2 basis point to 4.529%.
-
The yield on the 10-year Treasury note
TMUBMUSD10Y,
3.769%
fell 7 basis points to 3.755%.
-
The yield on the 30-year Treasury note
US00,
+0.02%
was down 9 basis points to 3.813%,
What’s driving markets?
Longer-dated Treasury note yields were slipping a day after concerns about additional China COVID-19 lockdowns increased global economic growth concerns.
The spread between 2- and 10-year Treasury yields ended the New York session at minus 76 basis points, its most inverted level since Oct. 5, 1981, a sign that some say points to an inevitable recession.
Investors will be looking for clues as to the Fed’s thinking on interest rates and inflation when the minutes of the November meeting, in which the central bank hiked its benchmark rate by 0.75 percentage points to a range of 3.75% to 4%, will be released at 2 p.m. Eastern Time.
“The tone of the minutes is likely to suggest further rate hikes, potentially encouraging some bear flattening of the curve,” said strategists at TD Securities.
Wednesday will also bring durable goods orders for October and initial jobless benefit claims due at 8:30 a.m., followed by the flash S&P Global U.S. manufacturing and services purchasing managers indexes at 9:45 a.m. The University of Michigan’s final November consumer sentiment index and five-year inflation expectations are due at 10 a.m., alongside October new home sales.
U.S. stock exchanges will be closed for Thanksgiving Day on Thursday, Nov. 24, and will reopen the next day only for an abbreviated session on Black Friday, the annual end-of-year shopping event, with trading ending at 1 p.m. Eastern on Nov. 25.
The bond market also will be closed for Thanksgiving Day and reopen the next day for an abbreviated session and will close at 2 p.m.
