- US 10-year treasury yields drop to the fresh low since October 09 mainly weighed down by fears of China’s coronavirus outbreak.
- Yields in Australia and Germany were down too.
- FOMC failed to impress markets, attention turns to the US GDP for now.
The US 10-year treasury yields decline to the fresh low of 1.58%, down 6 basis points (bps), by the end of their Wednesday’s session (early morning session for Asia). The risk barometer portrays the market’s fears emanating from China’s outbreak of coronavirus.
The fatal disease crossed the SARS epidemic of 2002/03 while taking more than 130 lives and +6,500 confirmed cases. Even if there are no deaths due to same outside China, the sentiment is pretty downbeat.
To avoid being infected due to the same, global airlines and businesses have started staying back from China. Even the governments, like in the US, the UK and China have also taken measures to push travelers away from Beijing.
Elsewhere, downbeat Pending Home Sales and Wholesale Inventories preceded a mostly unchanged outlook by the US Federal Reserve. US President Donald Trump’s signing of the key trade deal with Canada and Mexico, known as USMCA, as well as the European Union’s sign to the UK PM Boris Johnson’s Brexit deal also failed to impress markets.
Not only the US yields but coupons for the similar-maturity bonds from Australia and Germany were down too.
Investors will now keep eyes on Chinese headlines ahead of the key events like Bank of England’s (BOE) monetary policy meeting and the preliminary reading of the US fourth quarter (Q4) GDP.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD remains above 1.0700 amid expectations of Fed refraining from further rate hikes
EUR/USD continues to gain ground on Thursday as the prevailing positive sentiment in the market provides support for risk-sensitive currencies like the Euro. This improved risk appetite could be attributed to dovish remarks from Federal Reserve Chairman Jerome Powell on Wednesday.
GBP/USD gains traction above 1.2500, Fed keeps rates steady
GBP/USD gains traction near 1.2535 during the early Thursday. The uptick of the major pair is supported by the sharp decline of the US Dollar after the US Federal Reserve left its interest rate unchanged.
Gold price struggles for a firm intraday direction, hover above $2,300
Gold price fails to lure buyers amid a fresh leg up in the US bond yields, modest USD uptick. A positive risk tone also contributes to capping the upside for the safe-haven precious metal. Traders, however, might prefer to wait for the US NFP report before placing aggressive bets.
Top 3 Price Prediction BTC, ETH, XRP: Altcoins to pump once BTC bottoms out, slow grind up for now
Bitcoin reclaiming above $59,200 would hint that BTC has already bottomed out, setting the tone for a run north. Ethereum holding above $2,900 keeps a bullish reversal pattern viable despite falling momentum. Ripple coils up for a move north as XRP bulls defend $0.5000.
Fed meeting: The hawkish pivot that never was, and the massive surge in the Yen
The Fed’s latest meeting is over, and the tone was more dovish than expected, but that is because the rate hike hype in the US was over-egged, and rate cut hopes had been pared back too far in recent weeks.