Treasury yields climb as investors monitor omicron variant
- Market expectations have grown for the Fed to zero in on combating inflation, following increasingly hawkish comments from policymakers.
- The omicron variant has now been detected in almost one third of U.S. states, health officials said on Sunday, although the delta variant remains the dominant strain behind rising caseloads nationwide.
Treasury yields rose on Monday as risk sentiment looked for a rebound following Friday's pullback, with investors monitoring the omicron Covid-19 variant and the Federal Reserve's potential policy tightening.
The yield on the benchmark 10-year Treasury note rose 10 basis points to 1.441% while the yield on the 30-year Treasury bond climbed 9.8 basis points to 1.773%. Yields move inversely to prices and one basis point equals 0.01%.
Treasurys
| TICKER | COMPANY | YIELD | CHANGE |
|---|---|---|---|
| US1M | U.S. 1 Month Treasury | 5.375% | -0.001 |
| US3M | U.S. 3 Month Treasury | 5.485% | +0.081 |
| US6M | U.S. 6 Month Treasury | 5.409% | +0.017 |
| US1Y | U.S. 1 Year Treasury | 5.256% | +0.048 |
| US2Y | U.S. 2 Year Treasury | 4.989% | -0.009 |
| US10Y | U.S. 10 Year Treasury | 4.686% | -0.02 |
| US30Y | U.S. 30 Year Treasury | 4.792% | -0.028 |
Market expectations have grown for the Fed to zero in on combating inflation, following increasingly hawkish comments from policymakers.
Meanwhile the omicron variant has now been detected in almost one third of U.S. states, health officials said on Sunday, although the delta variant remains the dominant strain behind rising caseloads nationwide.
Goldman Sachs on Saturday cut its U.S. GDP growth forecast for full-year 2022 to 3.8% from 4.2%, citing fresh uncertainty over economic reopening and global goods supply shortages due to the variant.
Disappointing jobs data on Friday was a key driver of the sell-off in risk assets, which saw tech stocks fall hard.
Nonfarm payrolls increased by 210,000 last month, the Labor Department said Friday, which was below the 573,000 number economists surveyed by Dow Jones were expecting.
Global investors are also watching bitcoin prices, which plunged over the weekend before recouping some of its losses on Sunday.
There are no major economic data releases expected Monday. Auctions will be held for $57 billion of 13-week Treasury bills and $51 billion of 26-week bills.