Bond Market Hits a Turning Point as Path Clears for Fed Cuts
- A Bloomberg gauge of US bonds has wiped out its 2024 losses
- Rally pushes two-year yields to lowest level since March
Two-year Treasury yields are down 12 basis points this week to 4.48%, the lowest since March.
Photographer: Ting Shen/BloombergThis article is for subscribers only.
The world’s biggest bond market is reaching a turning point, with US Treasuries wiping out their 2024 losses as traders start to embrace the idea of three interest-rate cuts this year.
Optimism tied to an ebb in inflation was on full display this week in US government debt, with yields across the curve slumping as the data was seen supporting the case for lower borrowing costs as soon as September. Two-year Treasury yields — more sensitive than longer maturities to Federal Reserve monetary policy — are down 15 basis points this week to 4.45%, the lowest since March.