Five-Year Treasury Note Takes the Pain in the Butterfly: Chart

Treasury five-year notes are lagging behind surrounding maturities by the most since July 2015 as traders price in a more hawkish Federal Reserve and a pickup in economic growth. The underperformance is seen in the so-called butterfly-spread index, which measures how the five-year note is performing against the two- and 10-year Treasury by replicating a trade involving the three securities. A positive reading signals investors are more bearish on the middle of the three maturities, making it relatively cheap versus the others.

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