US yields extend recent run higher after more upbeat US economic data
TLT•US Treasury yields rose after stronger economic data, with the 30-year yield reaching a 22-year high and the 10-year yield a 19-year high. Traders saw more than a 66% chance of another Fed rate hike in October.
1. Yields hit new highs
The 10-year Treasury yield rose 3.4 basis points to 5.196%, while the 30-year yield gained 5.1 basis points to 5.513%. New orders for key manufactured capital goods increased more than expected in August, and the prior month’s figures were revised sharply higher.
2. Rate hike expectations rise
Traders saw more than a 66% chance of another Fed rate hike at its next meeting in October. Several Fed officials said additional increases may be needed to curb price growth. The two-year yield fell 0.6 basis points to 4.889%, and the gap between two- and 10-year yields was 30.5 basis points.
3. Oil edges lower
Oil prices eased as investors weighed the possibility of a truce between the US and Iran. Fixed-income portfolio manager John Luke Tyner said the Fed can slow demand, but warned it may do so by too much.
