U.S. government bond prices increase sharply after confirmation of Powell’s speech

(New York = Yonhap Infomax) Correspondent Jinho Jeong = U.S. Treasury bond prices are rising.

Intraday trend of U.S. 10-year Treasury bond interest rates[출처 : 연합인포맥스]

As U.S. Federal Reserve Chairman Jerome Powell is expected to repeat his existing position in his testimony to the U.S. Congress, the bond market is accepting this as a removal of uncertainty.

According to Yonhap Infomax’s overseas interest rate intraday screen (screen number 6532), as of 9:30 a.m. on the 6th (hereinafter US Eastern time), the 10-year Treasury bond interest rate in the New York bond market was 4.117%, down 2.10bp from 3 p.m. on the previous trading day. recorded.

The 2-year interest rate, which is sensitive to monetary policy, fell 2.30bp to 4.537% during the same period.

The 30-year government bond interest rate was traded at 4.273%, down 0.20bp from the previous day.

There was little difference in the reversal width between 10-year and 2-year notes, from -42.2bp to -42.0bp on the previous trading day.

Government bond interest rates and prices move in opposite directions.

Chairman Powell will give his semi-annual monetary policy report to the U.S. House of Representatives at 10 a.m. on this day. Prior to this, the speech posted in advance on the Federal Reserve website mainly consisted of repeating existing positions.

“We believe that policy rates have reached the peak of this tightening cycle,” he said in the speech. “If the U.S. economy grows broadly as expected, it may be appropriate to begin to reverse policy tightening at some point this year.”

But at the same time, he added, “the Federal Open Market Committee (FOMC) does not believe it is appropriate to lower the policy rate range until there is greater confidence that inflation is moving toward the Fed’s 2% target.”

This means that there will be no rush to cut interest rates unless inflation slows down further for a longer period of time. This is in line with the public remarks made by Chairman Powell and other Federal Reserve officials in their speeches.

Chairman Powell emphasized that while there are concerns about easing policy regulations too quickly or too much, there are also risks of easing them too late or too little, and that he will continue to check data to find a balance.

After Chairman Powell’s speech was released in advance, government bond yields trended downward. Government bond interest rates, which had been fluctuating in a steady range while waiting for his speech to the National Assembly, are believed to have eliminated uncertainty as no unusual details were found in his speech.

Meanwhile, U.S. private employment growth in February was found to be below Wall Street’s expectations.

According to the ADP National Employment Report, private sector employment in February increased by 140,000 from the previous month. This is lower than the 150,000 increase expected by experts compiled by the Wall Street Journal (WSJ).

Wages in February rose 5.1% compared to the same period last year. This is the lowest level since August 2021.

jhjin@yna.co.kr

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This article was published at 23:50 on the Infomax financial information terminal.

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