The yield on 10-year authorities bonds is fixed at 1.6%.
US Treasury bond yields were flat on Tuesday morning as investors await the release of job vacancy data.
The benchmark 10-year Treasury note yield rose 2 basis points to 1.62%. The 30 year Treasury bond yield increased 3 basis points to 2.347%. The interest rates for bonds with shorter maturities were anchored.
The returns move inversely to the prices.
Inflation remained on the front line and in the center of Wall Street amid fears the Federal Reserve may be forced to hike rates sooner than the telegraph to keep high-growth large-cap tech stocks under pressure.
In particular, economists are concerned about bottlenecks on the supply side of the US economy: a lack of raw materials, labor, and other inputs to produce all of the goods and services demanded by other businesses and American consumers.
The Labor Department’s April job report published on Friday initially relieved some investors of their Fed fears, as 266,000 payrolls were added far less than expected. Wall Street’s knee-jerk reaction assumed that the economy would create far fewer jobs because employers refused to hire the expected number of workers.
However, fears of inflation crept in later as more traders began to see the low workforce as a supply-side problem. In other words, Americans of working age did not want to return to the workforce. In theory, this could force employers to lure would-be workers with higher wages and generate corporate profits.
“If the supply disruption continues and demand remains firm, the Fed may have to tighten monetary policy faster than expected,” wrote Dennis DeBusschere, ISI strategist at Evercore, on Tuesday. “That theory seems to increase market volatility and lower tech stocks. Former New York Fed President Bill Dudley suggested yesterday that a top federal funding rate of 4.5% is possible.”
Meanwhile, Federal Reserve Governor Lael Brainard will be speaking at the Society for Advancing Business Writing and Editing conference on monetary policy and the economic outlook for the United States at 12:00 noon (CET).
The Department of Labor is expected to release the latest results of its April job vacancy and sales survey at 10 a.m.CET.