US Treasury yields fell on Tuesday as investors waited for the Federal Reserve’s latest meeting to start later in the day and were worried about the outcome of its policies.
3:55 a.m. ET benchmark yields 10 year government bond It decreased by more than 2 basis points to 3.5253%.On the other hand, policy-sensitive 2 year government bond Yields fell by almost 4 basis points to last trade at 4.2218%.
Yields and prices are inversely related, with 1 basis point equaling 0.01%.
The Fed is widely expected to announce a 25 basis point rate hike at the end of Wednesday’s meeting, further slowing the pace of rate hikes it has implemented in its fight against inflation.
Investors will also look to central banks for guidance on interest rate policy and expectations for broader economic development. This includes the question of whether inflation will ease and whether the US economy may be able to avoid a deep recession.
In recent months, there has been widespread concern over the pace of interest rate hikes that will lead to a contraction in the US economy.
On the data side, the S&P Case-Shiller Home Price Index report for November and the Chicago Purchasing Managers Index are due out on Tuesday. Corporate earnings season continues for Pfizer, McDonald’s and General Motors.
A series of fresh data insights could provide hints about the outlook for the U.S. economy and the impact of high inflation and interest rates on businesses and consumers.
