CNBC reports that according to ING senior rates strategist Antoine Bouvet, the 10-year U.S. Treasury yield is likely to hit 2% by the end of the year but could spike “well above” that in the second quarter.
Bouvet told that the envisaged re-opening of the economy in the second quarter will result in strong retail sales on the back of the U.S. government’s stimulus package.
All these factors will “contribute and conspire towards optimism in the market and then towards that spike in U.S. Treasurys,” Bouvet said, expecting yields to reach a “minimum” of 2%.
The 10-year U.S. Treasury yield shot up from 1% since the end of January, amid concerns about rising inflation. These concerns have been compounded by fears that the U.S. government’s $1.9 trillion fiscal relief package could stimulate the economy too quickly and cause a surge in prices.
While Bouvet said a lot of that increase in inflation would be temporary, he said it would be interesting to see how the U.S. Federal Reserve reacts.
ING expected average inflation to reach 2.9% this year and stay at that level next year.
© 2000-2021. All rights reserved.
This site is managed by Teletrade D.J. Limited 20599 IBC 2012 (First Floor, First St. Vincent Bank Ltd Building, James Street, Kingstown, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at email@example.com.