Spooked by the Fed’s shock-and-awe surprise 50-basis-point rate cut,
the already frazzled markets did a job today. Gold surged nearly 3%. The
three major stock indices all swooned nearly 3%. And Treasury yields plunged across the board.
The 10-year Treasury yield plunged from 1.13% pre-announcement to an intraday low of 0.935%, and closed officially at 1.02%. When the yield drops, it means that bond prices rise. In late trading the yield fell below 1% again, and is currently at 0.997% reflected in the chart (data via Investing.com):
At this point, nearly the entire yield curve is below our most doctored and repressed US inflation gauge, the Fed’s preferred “core PCE,” which languishes at 1.6%. And the entire yield curve is far below the Cleveland Fed’s median CPI, which has surged to 2.9%.
The Median CPI is based on the data from the Consumer Price Index (CPI) but removes the extremes of price increases and price decreases, that are often temporary, to reveal underlying inflation trends:
Read more at: Yield Curve Gets Ugly, 10-Year Treasury Yield Falls Below 1% for First Time Ever, 30-Year at Record Low, on Rising Inflation | Wolf Street
The 10-year Treasury yield plunged from 1.13% pre-announcement to an intraday low of 0.935%, and closed officially at 1.02%. When the yield drops, it means that bond prices rise. In late trading the yield fell below 1% again, and is currently at 0.997% reflected in the chart (data via Investing.com):
At this point, nearly the entire yield curve is below our most doctored and repressed US inflation gauge, the Fed’s preferred “core PCE,” which languishes at 1.6%. And the entire yield curve is far below the Cleveland Fed’s median CPI, which has surged to 2.9%.
The Median CPI is based on the data from the Consumer Price Index (CPI) but removes the extremes of price increases and price decreases, that are often temporary, to reveal underlying inflation trends:
Read more at: Yield Curve Gets Ugly, 10-Year Treasury Yield Falls Below 1% for First Time Ever, 30-Year at Record Low, on Rising Inflation | Wolf Street
