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U.S. bond yields generally fell at the beginning of the week. This week will usher in policy meetings and important economic data.

2024-01-30

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The U.S. bond market strengthened slightly on Monday (January 29) local time. The Federal Reserve will hold its first interest rate meeting in 2024 on Thursday. The market generally expects that the policy interest rate will remain unchanged at 5.25%-5.5%. The meeting will also Reveal important information such as when interest rates will be cut.

Industry insiders said that many investors are currently over-trading the future "interest rate cut market", but before the boots fall, the market still has expectations and is looking for subtle evidence from all levels.

According to data from the U.S. Treasury Department, as of Monday's close, U.S. bond yields fell across the board. The 2-year U.S. bond yield fell 3.5 BPs to 4.328%, the 3-year U.S. bond yield fell 3.8 BPs to 4.117%, and the 5-year U.S. bond yield fell 3.8 BPs to 4.117%. The yield fell 5.6 BPs to 3.99%, the 10-year U.S. bond yield fell 6.5 BPs to 4.08%, and the 30-year U.S. bond yield fell 5.6 BPs to 4.317%.

Pantheon macroeconomist Ian Shepherdson expects the Fed's first easing to come in March or May. "Unless they have a very good reason to think the economy is about to strengthen again or inflation is going to rebound in some way, they are going to have to ease," he said. Monetary Policy."

In addition to the interest rate meeting this week, a number of important data will be released, including December JOLTS job vacancy data and January Conference Board consumer confidence index to be released on Tuesday, as well as non-farm employment data to be released on Friday.

Eren Sengezer, an analyst at the well-known financial website FXStreet, wrote last Friday that if the number of new non-farm jobs is close to 200,000, the market may react to the labor force participation rate and wage inflation data. A rebound in labor force participation data could have a positive impact on the dollar.

According to CME's "Fed Watch", the probability that the Federal Reserve will keep interest rates unchanged in the range of 5.25%-5.50% in February is 96.9%, and the probability of cutting interest rates by 25 basis points is 3.1%. The probability of keeping interest rates unchanged by March is 52.8%, the probability of a cumulative 25 basis point interest rate cut is 45.8%, and the probability of a cumulative 50 basis point interest rate cut is 1.4%.

The above information is provided by special analysts and is for reference only. CM Trade does not guarantee the accuracy, timeliness and completeness of the information content, so you should not place too much reliance on the information provided. CM Trade is not a company that provides financial advice, and only provides services of the nature of execution of orders. Readers are advised to seek relevant investment advice on their own. Please see our full disclaimer.

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U.S. bond yields generally fell at the beginning of the week. This week will usher in policy meetings and important economic data.

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