Treasury Yields Rise, 2Y/10Y Curve Remains Inverted

Treasury yields rose on Tuesday as investors watch corporate earnings releases and choppy sentiment on Wall Street.

At around 6:06 a.m. ET, the yield on the benchmark 10-year Treasury was up to 2.991%, while the yield on the 30-year Treasury rose to 3.165%. Yields move inversely to prices.

The spread between 2-year and 10-year yields remained inverted as the market prices the possibility of the Federal Reserve raising interest rates by 75 basis points at its July 26-27 meeting – rather than the more aggressive option of 100 basis points. points. The 2-year yield was last seen at 3.1684%.

Yield curve inversions – when short-term government bonds have higher yields than longer-term bonds despite lower risk – are often seen by markets as signs that a recession is imminent.

As investors attempt to chart the course of inflation, economic growth and the policy path of the Fed, stock markets and other risk assets have remained volatile.

The Dow Jones Industrial Average fell more than 200 points on Monday, reversing an earlier rally as the earnings season gathered pace.

On the data front, the June housing starts and building permits numbers are due at 8:30 a.m. ET.

Edward N. Arrington