- Us at 10 years old flat after a recent wave; Treasure with auction 39 billion dollars in 10.22 billion dollars in 30 years later this week.
- DXY drops by 0.31% to 99.47, not following higher yields in the midst of expansion of the trade deficit and fueled prudence.
- The market price in July was the drop in rates and two others by the end of the year; Eyes on Powell's post-FOMC advice.
Exchanges from the Treasury at 10 years of American 10 years undergone Tuesday, while market players await the last monetary policy meeting of the Federal Reserve on May 7.
The 10 -year yield is 4.345% before auction of $ 39 billion; Dxy Falls, increasing gold beyond $ 3,400 while markets are waiting for Powell's tone
The US Treasury will sell $ 39 billion from the bond at 10 years. Thursday, the Treasury will sell $ 22 billion in bonds at 30 years at auction at $ 22 billion.
Yield for the US Treasury bonds at 10 years remains at 4.345% after having increased more than fifteen basic points (BPS) during the last three negotiation sessions, raising the coupon by around 4.19%. Nevertheless, he failed to underlie the greenback, which remains under pressure, as represented by the US dollar index (DXY).
The DXY, which follows Buck's performance against a basket of six currencies, fell 0.31% to 99.47.
Moderate American yields and a lower US dollar increased gold prices. The yellow metal is an event again to compensate for the bar of $ 3,400 because it records gains of more than 1.85%.
In terms of data, the American commercial balance revealed that the deficit widen in March, resulting in the negative gross domestic product (GDP) for the first quarter of 2025.
In the meantime, market players await Wednesday the meeting of the Federal Open Market Committee (FOMC). Political decision -makers should maintain unchanged rates due to the fears that prices are subject to inflation.
After the meeting, merchants will watch the press conference of the president of the Fed, Jerome Powell, who could prepare the ground for the next move of the Fed.
Swaps markets show that traders predicting the reduction in the first drop in the Fed in 2025 are in July. They are also prices in two other 25 basic points (BPS) to ensure towards the end of the year.
FAQ Nourished
In the United States, monetary policy is shaped by the Federal Reserve (Fed). The Fed has two mandates: reach price stability and promote full employment. Its main tool to achieve these objectives is to adjust interest rates. When prices are increasing too quickly and inflation is greater than the 2% target of the Fed, it increases interest rates, increasing borrowing costs throughout the economy. The result is a stronger US dollar (USD) because it makes the United States a more attractive place for international investors to park their money. When inflation falls below 2% or the unemployment rate is too high, the Fed can reduce interest rates to encourage the loan, which weighs on the greenback.
The Federal Reserve (Fed) organizes eight political meetings per year, where the Federal Open Market Committee (FOMC) assesses the economic conditions and makes monetary policy decisions. The FOMC is assisted by twelve officials of the Fed – the seven members of the Council of Governors, the president of the Federal Reserve Bank of New York and four of the eleven presidents of the remaining regional reserve bank, who have a period of one year on a rotating basis.
In extreme situations, the federal reserve can use a policy called quantitative relaxation (QE). QE is the process by which the Fed considerably increases the credit flow in a blocked financial system. It is a non -standard political measure used during crises or when inflation is extremely low. It was the Fed's weapon of choice during the great financial crisis in 2008. It implies the Fed Print more dollars and use them to buy high -level bonds from financial institutions. QE generally weakens the US dollar.
The quantitative tightening (QT) is the opposite process of the QE, by which the federal reserve ceases to buy obligations from financial institutions and does not reinvest the principal of the obligations it holds at maturity, to buy new obligations. It is generally positive for the value of the US dollar.
