The yield on the 10-year US Treasury note slipped to 4.71% on Monday, pulling back after two straight sessions of gains as investors shifted their focus to Federal Reserve Governor Kevin Warsh’s upcoming remarks at the Jackson Hole symposium. Market participants will closely scrutinize his speech on Friday for signals about how the Fed may respond to stubborn inflation, which remains above the 2% target, and to growing fiscal strains, with US federal debt now exceeding $40 trillion.
Last week, the Treasury Department announced plans to at least double its buybacks of longer-dated securities in an effort to improve market functioning. However, the move offered only short-lived relief from the ongoing bond selloff. Investors are also awaiting Wednesday’s release of the July personal consumption expenditures (PCE) price index— the Fed’s preferred inflation gauge— for updated insight into underlying price pressures.
