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6 Jan 2015
US 10-yr yield falls below 2%
FXStreet (Mumbai) - The 10-year Treasury yield in the US fell below 2% mark for the first since Oct 2014 as the yield curve continues to flatten due to a combined effect of risk aversion and increased speculation of an early interest rate hike in the US.
The 10-yr yield now trades 4.5 basis points lower at 1.992%. Interestingly, the yield has been on the slow and steady decline post the stellar November 2013 jobs report released last month. Meanwhile, at the short-end the yields have been somewhat resilient as the markets speculate the Federal Reserve would raise interest rates sometime in the middle of this year. The 2-yr yield has once again outperformed the ones at the long-end, trading 2.00 basis points lower at 0.645%.
Moreover, the rout in Crude prices, renewed sell-off in equities and fears of ‘Grexit’ has helped the long duration treasury prices gain strength. The 10-yr yield may extend losses if the stock markets across Europe and US see heightened risk aversion.
10-yr Treasury yield Technical Levels
The immediate support can be seen at 1.975% (Dec 2012 high), under which losses could be extended to 1.90%. Meanwhile, immediate psychological resistance is seen at 2.00%, followed by a technical resistance at 2.047% (Dec 17 low).
The 10-yr yield now trades 4.5 basis points lower at 1.992%. Interestingly, the yield has been on the slow and steady decline post the stellar November 2013 jobs report released last month. Meanwhile, at the short-end the yields have been somewhat resilient as the markets speculate the Federal Reserve would raise interest rates sometime in the middle of this year. The 2-yr yield has once again outperformed the ones at the long-end, trading 2.00 basis points lower at 0.645%.
Moreover, the rout in Crude prices, renewed sell-off in equities and fears of ‘Grexit’ has helped the long duration treasury prices gain strength. The 10-yr yield may extend losses if the stock markets across Europe and US see heightened risk aversion.
10-yr Treasury yield Technical Levels
The immediate support can be seen at 1.975% (Dec 2012 high), under which losses could be extended to 1.90%. Meanwhile, immediate psychological resistance is seen at 2.00%, followed by a technical resistance at 2.047% (Dec 17 low).