US Treasury yields were little changed on Monday on hesitation to make major bets in thin year-end trading conditions and as attention generally shifted away from the timing of the Federal Reserve's next rate hike. Traders were cautious about making significant bets ahead of year-end because of the thin and potentially erratic trading environment, analysts said.
"You don't want big positions when markets are illiquid," said David Keeble, global head of interest rates strategy at Credit Agricole Corporate & Investment Bank in New York. "You don't want to lose all of your profits of the year in the last couple of trading days." Through Friday, the Barclays US Treasury Index was up 1.3 percent for the year. The Barclays US Treasury: 1-3-Year Index was up 0.6 percent. The Barclays US Treasury: 25-plus-Year Index was mostly flat.
Analysts said a lack of top-tier US economic data also kept yields generally unchanged from Friday's levels, while the after-effects of the Fed hiking rates for the first time in nearly a decade last week were muted. Discussion over the timing of the next Fed rate hike will likely not intensify until March, a view that was keeping market participants from trading based on expectations for future Fed rate hikes, said Stan Shipley, bond strategist at Evercore ISI in New York.
"The next time we're going to have this debate is in March, and I want to see a couple employment reports before we get there," Shipley said in reference to monthly US nonfarm payrolls data. Benchmark 10-year US Treasury notes were last mostly flat in price to yield 2.195 percent, from a yield of 2.197 percent late on Friday. US 30-year Treasury bonds were last down 2/32 in price to yield 2.911 percent, from a yield of 2.908 percent late on Friday. US two-year Treasury notes were last mostly flat in price to yield 0.956 percent, from a yield of 0.960 percent late on Friday.
Comments
Comments are closed.