The 10-year Treasury yield is down by 4.3 bps to 4.061% on Friday as the stock market continues to show signs of unease amid concerns of an AI bubble and elevated valuations
TipRanks Black Friday Sale
Investors have taken a risk-off approach in recent days amid a slide in stocks and rising volatility, resulting in increased demand for safe-haven assets like Treasuries and gold (XAUUSD). As a reminder, a Treasury’s yield moves in the opposite direction of its price.
Rate Cut Odds Surge Higher
Surging rate cut odds following comments from Fed Bank of New York President John Williams are also affecting the 10-year yield. Williams said that he supports “further adjustment in the near term to the target range for the federal funds rate” in order to achieve a neutral rate. A neutral rate neither stimulates nor hinders economic growth.
The odds of a 25 bps cut at the December 9-10 Federal Open Market Committee (FOMC) meeting on CME’s FedWatch tool spiked to 73.3% compared to 39.1% a day ago and 44.4% a week ago.
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