10-year Treasury yield raises to 4% due to sloppy auction

June 10, 2009 by · Leave a Comment
Filed under: Currency News 

It can not be a good sign when fixed income trader called the Treasury auction “sloppy”.  With the 10-year at 4%, we can expect that the longer portion of the “yield curve” is going to steepen.  This does not bode well for future interest rate which will need to go much higher to match future inflation expectations.  With the amount of money that has been pumped into our economy through our banking system and with interests at historic lows, inflation is the obvious policy of the day.

News (Reuters):

U.S. Treasury prices fell on Wednesday, sending benchmark yields to 4.0 percent for the first time in eight months, after an auction of 10-year notes heightened concerns over the burgeoning U.S. budget deficit.

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