U.S. Treasury yields mixed Wednesday morning, after data showed lower-than-expected inflation.
The yield on the 10-year benchmark Treasury note rose less than a basis point to 1.28% at 3:50 am ET. The yield on the 30-year Treasury bond fell almost one basis point, to 1.845%. Yields move inversely to prices and a basis point equals 0.01%.
Ten-year yields fell to 1.277% on Tuesday, after the August consumer price index rose 5.3% year-on-year, below a forecast of 5.4%. The core CPI rose just 0.1% month-on-month in August, below a projected 0.3% increase.
Willem Sels, director of investment, private banking and wealth management at HSBC, said on Tuesday that the data should “provide some comfort because inflation does not appear to be accelerating further and therefore the Fed may take an approach gradual normalization of policy and is reduced “.
Sels said HSBC expected inflation to fall further in recent years, in part because “commodity effects on commodity prices will become more deflationary near the end of the year.”
“However, there is uncertainty about the rate and extent of the fall, as many variables influence inflation,” he added, referring to the increased spread of the delta variant and the problems of the delta. supply chain.
As for the economic data to be released on Wednesday, August import and export prices will be released at 8:30 am ET. August industrial production data is expected to come out at 9:15 am ET.
A $ 30 billion auction will be held on 119-day bills on Wednesday.