US 10Y TREASURY: tariffs negotiations

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Another rollercoaster of US Treasury yields calmed down after the FOMC meeting held during the previous week. As expected, the Fed did not make any changes to the current levels of interest rates. However, in case that trade tariffs cause some harm to the US economy, the Fed is in position to react swiftly. The economy is still growing at a solid pace, as Fed officials see it, and the jobs market is relatively strong while the inflation is still on the target to reach gradually 2% in the coming period.

The 10Y US benchmark yields reached lowest weekly level at 4,26% and moved to the higher grounds in the after FOMC meeting trading. They have closed the week at the level of 4,39%. Markets will spend the week ahead by digesting the latest economic data and also April inflation which is due for the release on Monday. However, the US-China trade tariffs negotiations are expected to start soon, which might bring again some higher volatility and nervousness among investors and traders on the market. As per current charts, some relaxation in the 10Y yields is quite possible, however, the impact of news related to negotiations could impact moves to both sides.

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