For those that follow interest rates and the underpinnings of the economy for a living, a 3 percent 10-year Treasury rate is something that should be noted. While the media may be positioning this as front page news on nearly every financial news website you check today, I don’t believe…
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Tag: Federal Reserve
A new interest rate regime
As 2017 began, bond investors speculated on the impact of the new administration’s policies. How inflationary might lower taxes, deregulation and a big infrastructure bill be for the U.S. economy? The first quarter spike in 10-year Treasury rates (shown below) indicated that the bond market was expecting big increases in…
The two-year has broken through to the other side
Have we finally begun seeing the normalization of interest rates in U.S. Treasuries? Although we’ve seen sudden rises in interest rates before, we haven’t seen a precipitous rise like we’ve seen in the last month. Although we often focus on the ten-year Treasury as the barometer of interest rates, the two-year Treasury is our focus at this point.…
CNBC: Fed concerns, tax policy, and black swans
I recently appeared on CNBC “Trading Nation” to share my market forecast as we continue into the new year. A possible concern for investors may be if the Federal Reserve raises interest rates too quickly. However, I offered that the transition of power from Janet Yellen to Jerome Powell seems…
Charlie’s month-end reading list
Here are some of the latest topics of interest at Fort Pitt Capital: The first piece, “Fed gets more ammo for rate hikes,” is a Wolf Street article showing that the Producer Price Index (PPI) is rising faster than expected. The index has risen 3.1 percent over the past year,…
Coaster brakes
Back in September, the U.S. Federal Reserve announced that their massive bond-buying program known as Quantitative Easing (QE) would begin to be reversed on October 1st, 2017. Given this momentous occasion (at least for bond nerds like us), we thought it would be useful to summarize, in laymen’s terms, the…
No backing down for the Fed
The events of the third quarter of 2017 were full of sound and fury, but really didn’t signify much in the U.S. bond market. Interest rates on the ten-year Treasury bond began the quarter at 2.29 percent. July was flat, but August dawned to a round of North Korean sabre…
Fox Business: What’s driving the market ahead?
Earlier this week, I returned to Fox Business “Countdown to the Closing Bell” to discuss recent market direction. Over the last few weeks, it seems as if investors have reconsidered their trading and realized things aren’t as grim as it may seem. In addition, initiatives from the Trump administration, like…
The Fed pushes – bonds push back
On March 15 the Federal Reserve raised short-term interest rates for only the third time in 10 years, to a range of .75 percent to 1.00 percent. With Fed funds futures pricing in a 100 percent probability of an increase prior to the meeting, the Fed had no other option…
Is this the end of the 30 year bond rally?
The fourth quarter of 2016 was anything but boring in the bond market. The U.S. Federal Reserve continued to play a vital role, ultimately raising short term interest rates for the first time in 2016 in December. However, it was not for the reasons that were expected. With the surprise…