From The Economic Times · · 2m
US Treasury Yields Rise as AI Jitters Persist
US Treasury yields edge higher but 10-year stays below 5% amid AI market concerns.
In brief
US Treasury yields edge higher but 10-year stays below 5% amid AI market concerns. US Treasury yields rose slightly but the 10-year yield remained under 5% as investors sought safety amid AI-related stock worries. Originally reported by The Economic Times.
US Treasury Yields Rise
US Treasury yields rose on Friday but the benchmark 10 year yield remained below the closely watched 5% mark as lingering doubts over the sustainability of the AI led market rally continued to support demand…
10-Year Yield Stays Below 5%
The 10-year Treasury yield rose 3.7 basis points to 4.992% on Friday but remained about 11 basis points lower on the week and was on track for a third consecutive weekly decline.
AI Market Concerns Drive Safe Assets
Investors sought safer assets amid renewed concerns around AI related stocks as the 10-year yield recorded its steepest one day fall in nearly four years.
Yield Drop on Thursday
The yield had dropped 19.3 basis points on Thursday, its biggest daily decline since March 10, 2023, when SVB Financial Group was closed by regulators after its failed attempt to raise capital.
Bond Analysts Note Risks
JoAnne Bianco, partner and senior investment strategist at BondBloxx Investment Management in Chicago, said yields could rise above 5% but sticky inflation, increased Treasury supply, higher term premiums and elevated energy prices would keep yields…
US Economic Activity Firm
S&P Global's flash US Composite PMI Output Index eased to 57.6 in October from 58.4 in September, which had been its highest level in five years, but remained comfortably above 50 signaling continued expansion.
Fed Rate Hike Expectations Fall
Market expectations for a Federal Reserve rate hike next week weakened further with the probability of at least a 25 basis point increase falling to 8.3% from 15.5% a week earlier and 70.
Inflation Outlook
The 10 year TIPS breakeven rate stood at 2.349%, suggesting markets see inflation averaging around 2.3% annually over the next decade.
The key point
US Treasury yields rose slightly but the 10-year yield remained under 5% as investors sought safety amid AI-related stock worries.
