Bond Traders in Limbo on Yields’ Path With Volatility Slumping
- Index measuring expected swings is near lowest since February
- Strategists eye early June monthly jobs data as next key event
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Expectations for volatility in Treasuries, by at least one measure, are about as low as they’ve been in months, driving home that the jury is still out on the next step for yields in the world’s biggest bond market.
U.S. government debt is staging a modest rebound this quarter, after a rout in the first three months of the year delivered the worst losses since 1980. Yields are now stuck in a range, with traders still flummoxed by some of the key questions looming over the economy: whether the rebound from the pandemic will prove sustainable, and whether building inflation pressures will be temporary, as the Federal Reserve maintains.