Fed Announcement Sends 10-Year Yield Higher
Prediction of 10-year US treasury note yield, courtesy of Statista.
The Federal Reserve declined to raise interest rates on Wednesday, spurring benchmark yields to hit session highs. The yield on the 10-year Treasury rose as high as 2.3% after the Fed announcement before settling in at 2.273%. A statement from the Fed provided no timetable for a rate hike and signaled that it wants to see further economic gains and higher inflation before raising rates, CNBC reports. The key short-term rate has resided at a record low near zero since 2008. Once the Fed raises the rate the costs of borrowing is likely to increase across the board. The statement also noted that the Fed expects inflation to rise gradually and sees improvement in consumer spending, housing and the job market. The US Treasury plans to sell $90B worth of bonds this week. [CNBC]