10-YEAR TREASURY YIELD HITS BIGGEST DAILY JUMP IN A YEAR

17.02.2021
Market News

U.S. Treasury Yields recorded the highest increase since March 2019 today. The market reopened on Tuesday after the United States went on holiday on Monday in conjunction with the President's Day general holiday. The bond market also closed last Monday.

Bidding that took place last Tuesday showed high demand for $ 54 billion 13-week bills, $ 15 billion 26-week bills, $ 30 billion 119-day bills and even $ 30 billion 42-days bills.

U.S. 10-Year Yields rose 1.312%, up 9.9 points and is the biggest jump in a day since last November. Meanwhile, 2-Year Yields bonds also jumped to 0.121%, while 30-Year Yields bonds also increased 2.083%.

Treasury revenues increased as investors watched with interest the latest developments of the $ 1.9 trillion USD stimulus package by President Joe Biden at the congressional level, apart from the development of vaccination programs in the United States.

Treasurys were under pressure as investors continued to sell bonds in expectation of higher inflation and economic growth later this year when the economy makes a fuller recovery.

Higher energy prices, rising stock markets, another fiscal relief package, and record-high Treasury auctions all represent the myriad factors pushing rates higher.

But investors cautioned the market selloff lacked a clear driver, leaving it unclear how long the surge in longer-term bond yields, and steepening of the yield curve, could last.

Moreover, recent employment data show there remains plenty of slack in the labor market due to the pandemic, preventing the Federal Reserve from moving away from its accommodative monetary policy stance. Signs that the central bank may start tapering its stimulus was one necessary ingredient for further weakness in Treasurys, analysts said.