Key Facts
• June 23: US Treasury yields fell during morning trading in New York.
• 10-year Treasury yield dropped 6 basis points to 4.31%, a one-week low.
• Fed Vice Chair Bowman suggested a July rate cut if inflation remains controlled.
• Fed Governor Waller expressed similar views on June 20.
• Short-term markets priced in a 55 basis point rate cut by year-end.
• US military bombed Iran’s nuclear facility over the weekend, boosting safe-haven demand.
• Bloomberg Dollar Spot Index erased earlier gains after Bowman’s comments.
• Japanese yen strengthened against the dollar, moving from 147 to mid-146 levels.
Summary
US Treasury yields declined on June 23 following dovish remarks by Federal Reserve Vice Chair Bowman, who indicated support for a July rate cut if inflation remains subdued. This followed similar comments by Fed Governor Waller earlier in the week. The 10-year Treasury yield fell 6 basis points to 4.31%, its lowest in a week. Short-term markets now anticipate a 55 basis point rate cut by the end of the year. The decline in yields was also driven by safe-haven demand after the US military bombed Iran’s nuclear facility over the weekend. In currency markets, the Bloomberg Dollar Spot Index erased earlier gains, while the Japanese yen strengthened against the dollar, moving from 147 to mid-146 levels.
