Thursday saw a sharp rise in US yield, with the 10-year yields rising 10% from 1.3% to 1.43% and breaking out from the recent consolidation phase.

It looks like the next move in yields will be to the upside, targeting the 1.5% level for the 10-year maturity.

It took some time for investors to digest the latest FOMC decision, which sounded hawkish, and they sold bonds Thursday, sending yields higher. 

Rising yields undermined precious metals as gold and silver fell yesterday, but they managed to erase those losses today. Despite rising inflation, it is hard to see metals performing well in the upcoming tapering environment.

The greenback ignored rising yields and remained weaker on the day against most of its major peers as the EURUSD pair moved toward the 1.1750 level.

Elsewhere, the Bank of England voted to begin its own tapering amid soaring inflation. However, the central bank decided to ignore the ongoing deterioration in the economic data. 

Later in the day, German IFO surveys will be released, expected to improve slightly and possibly influencing the EURUSD pair and German DAX index.

The calendar is rather empty during the US session, offering only new home sales, which rarely cause any market volatility. 

Source: https://www.axiory.com/market-news/yields-spike-sharply-as-markets-repriced-rate-expectations

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About Author

Peter comes from a background in corporate finance which began in 2013 when he completed the Corporate Finance Program at the University of Economics in Bratislava. He’s been actively involved in the market sector since 2008 and got his hands-on experience in trading in 2011. His experience in finance and trading continues not only as a market analyst at Axiory Intelligence but also through his studies to obtain a degree in Capital Markets. The study is in line with MIFID II regulations and is under the supervision of the European Regulator ESMA, which strongly emphasizes ethics and morale in investing and working with a client.

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