Treasury yields drop, 5-year and 30-year rates invert following Fed minutes
moved 6 basis points lower to 2.6381%. Yields move inversely to prices and 1 basis point is equal to 0.01%.Fed meeting minutes, released on Wednesday afternoon, showed that U.S. central bank officials planned to shrink its balance sheet by $95 billion a month. Fed officials also indicated that there could be one or more 50-basis-point interest rate increases ahead.
This hawkish tone from the Fed saw the 10-year Treasury yield notch a 3-year high. Investors have become concerned that more aggressive tightening by the Fed, in a bid to combat rising inflation, could actually hurt economic growth and lead to a recession. Inversions in Treasury yields, with investors selling out of short-dated government bonds in favor of long-dated debt, have reflected these recessionary fears.
Simon Harvey, head of FX analysis at Monex Europe, told CNBC's "Squawk Box Europe" on Thursday that the amount the Fed was withdrawing from the Treasury market wasn't necessarily "too aggressive."Stock picks and investing trends from CNBC Pro:
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