Treasuries rally before Powell's testimony

Monday, 08. July 2019 14:47

Prices of United States government debt advanced on Monday, which means yields weakened and took back some of previous gains, as stock selloff regained momentum. Following a strong monthly jobs report for June last week, traders have scaled back expectations for interest rate cuts hinted by the Federal Reserve. Its Chair Jerome Powell is due in Congress on July 10 and 11 and markets will be bracing for another potential shift in stance after policymakers on both sides of the Atlantic including the United Kingdom indicated they may cut borrowing costs. Eurozone sovereign bonds gained upon the landslide election victory of New Democracy in Greece yesterday.

The two-year US note yielded 1.852% at 8:41 am ET, down by 1.2 basis points on the day. The 10-year rate slipped 1.3 points to 2.024% compared to the fall of 1.8 points for the 30-year bonds. Corresponding futures advanced 0.02%, 0.09% and 0.22%, respectively.

In comparison, Britain's ten-year benchmark tumbled 3.4 points to 0.704% and Germany's equivalent Bund yield retreated by 1.4 points to a negative 0.376%. The yield on Greek bonds due in a decade fell by six points to 2.04% after touching a record low 2.013%.

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