Treasury Yield Spike Spooks Stocks, Breakevens Hit 4-Year High

In recent weeks, Treasury yields have been tumbling, the yield curve has been collapsing, and Breakevens sliding.

And just like that, it was gone...

Now, suddenly, everything reversed yesterday and is extending the reversal today...

Expectations for a 4th rate hike in 2018 are now at cycle highs...

10Y Breakevens have spiked to 4 year highs...

 

30Y Yields have snapped higher, breaking out of 3.00% to one month highs...

 

10Y Yield are back at their highest in a month - back above 2.90%...

And the yield curve has started to steepen notably...

 

And as rates rise, it seems inflationary pressures are disliked by stocks...

Cue: Calls that the bond bull market is dead...again.

Comments

J J Pettigrew Thu, 04/19/2018 - 09:12 Permalink

Be sure to take out food and energy...and health insurance....and house insurance.....and tariff impacts......rent...from the next "inflation" measure...so poorly reported by the antiquated CPI.

Still worried about deflation?  There never was a threat.

lester1 J J Pettigrew Thu, 04/19/2018 - 09:44 Permalink

US Treasuries will go much higher due to increased debt levels and lack of liquidity in the system to soak up all this new debt.

 

The Fed should NOT be raising rates, but instead be doing a new QE program to soak up all this new debt. Otherwise treasuries are going much higher.

 

Also, why buy treasuries now when you can wait until after the next rate hike and get a much higher interest rate??

In reply to by J J Pettigrew

WayneHinds Thu, 04/19/2018 - 09:19 Permalink

Is this going to stop the government sponsored Plunge Protection Team from selling volatility, precious materials, and buying SPX futures?  I think not.  If anything this will embolden them to buy more.  Expect a 400 pt up day

GooseShtepping Moron Thu, 04/19/2018 - 09:23 Permalink

There are untold numbers of dumb, dickless motherfuckers on this board who do nothing but write meaningless, spammy comments like, "Fuck it! They'll just CTRL+P for eternity!", and the rest you losers actually upvote these dickless wonders.

Do you now see what a bunch of idiots you are? Nobody can CRTL+P forever, you dumb, dickless, douchebag sack of shit. If you understood the first fucking thing about reality you would know that. The Fed has painted itself into a corner and now must face the inevitable music. They aren't going to get away with it. No one will.

But all you did was write stupid, meaningless, spammy comments.

You're nothing but a loser who deserves death.