Treasuries Fall as Yellen Expects Fed Rate Increase This Year
- Futures pricing shows probability of 2015 rate increase at 43%
- Yields rise as economy expanded faster than forecast in Q2
Fed Chair Signals 2015 is the Year For a Hike
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Treasuries fell, extending this week’s pattern of alternating between gains and losses, after Federal Reserve Chair Janet Yellen said the central bank is poised to raise interest rates this year.
Yields on shorter maturities, which are among the most sensitive to what the Fed does with its benchmark rate, rose after Yellen said in a speech Thursday that most policy makers, including herself, anticipate increasing rates by year-end. Treasuries remained lower after separate reports on Friday showed the U.S. economy expanded more than previously forecast in the second quarter and consumer sentiment fell less than forecast this month.