NEW YORK : A breakneck rally in US government bonds continued on Thursday, with 10-year Treasury yields falling to their lowest levels since early-2021 as investors sensed cracks in the economic recovery and cooling risks of high inflation. “In Q1, the market thought the Fed Funds rate would get back to where it was in the previous cycle at 2.38%. "As treasury yields continue to plunge, equity investors are reading the rally in the bond market as a sign of weakness ahead and taking profits now. "Naturally, all sorts of catalysts are being blamed for the decline ranging from the growing threat of the Delta variant, a weaker than expected economic recovery, or lack of an infrastructure deal. Sometimes, though, the market doesn't need an excuse to sell off and it just needs to let off some steam."

Source: Mint July 08, 2021 14:26 UTC