US Treasury yields edge up ahead of Fed meeting

By Ishika Dangayach on Dec 14, 2021 | 04:34 AM IST

The Treasury yield in the United States surged early Tuesday ahead of the Federal Reserve’s meeting, which will accelerate the winding down of its bond-buying program.

At 5:32 a.m. ET, the yield on the benchmark 10-year Treasury note increased by 2 basis points to 1.431 percent. The 30-year Treasury bond yield increased by one basis point to 1.841 percent.

The Federal Reserve is scheduled to conduct the meeting on Tuesday to discuss monetary policy.

When the Fed closes its meeting on Wednesday, investors will be looking to see if the increase in Covid-19 cases and the new Omicron version impacts how quickly the Fed will wind down the easy-money policies that have fueled this year's market surge, WSJ stated.

On Tuesday, The November producer pricing index will be issued at 8:30 a.m. ET.

Consumer Price Index

The recovery of the U.S. economy from the pandemic has caused the consumer price index (CPI) to jump 6.8 percent year on year in November.

The core CPI, excluding food and energy, maintained at its highest level since mid-1991, growing rapidly by 0.5 percent in November and by 4.9 percent year on year.

Food costs have risen by 6.1 percent in the last year, while energy prices have risen by 33.3 percent since November 2020, with a 3.5 percent increase in November.

The price of gasoline has soared by 58.1 percent.

Jobless Claims

New claims for unemployment in the United States have dropped to 184,000, the lowest level since September 1969, signaling that the job market is trying to recover from the coronavirus pandemic.

The Labour Department reported on Thursday a substantial increase of 43,000 from the previous week which was revised up by 5,000 from 222,000 to 227,000.

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