29 Apr 2015
Treasury yields inch higher despite weak GDP report
FXStreet (Mumbai) - The yields on the short duration and long duration treasury yields in the US extended gains even though the first estimate of the first quarter US GDP report showed a sharp slowdown in the economic activity.
The 10-year yield in the US rose to a high of 2.081%, before falling back to 2.053% after the US Commerce Department data showed the economic growth in the first quarter slowed down to an annualized rate of 0.2%, missing the estimate of 1% by a big margin. The 30-year yield rose to 2.792%, before moving back to 2.756%. At the moment, the long-end yields have gained at least 8 basis points.
Short-end yields under perform
The gains short-end yields – 1-year and 2-year – are relatively restricted as compared to the long-end. The 2-year yield is up 1.2 basis points, while the 1-year yield is more or less flat. The short-end of the curve mimics the short-term interest rate expectations in the economy.
The 10-year yield in the US rose to a high of 2.081%, before falling back to 2.053% after the US Commerce Department data showed the economic growth in the first quarter slowed down to an annualized rate of 0.2%, missing the estimate of 1% by a big margin. The 30-year yield rose to 2.792%, before moving back to 2.756%. At the moment, the long-end yields have gained at least 8 basis points.
Short-end yields under perform
The gains short-end yields – 1-year and 2-year – are relatively restricted as compared to the long-end. The 2-year yield is up 1.2 basis points, while the 1-year yield is more or less flat. The short-end of the curve mimics the short-term interest rate expectations in the economy.