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Who needs the Fed to cut rates? Risk-off frenzy driving 10-year yield to lowest since early 2017

May 23, 2019

Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions
Better Data for Better Investment DecisionsBetter Data for Better Investment Decisions

 

  • The growing tension between the US and China is driving investors to safe-haven investments
  • The top of that list is US debt with the 10-year note and 30-year bond the most popular
    • Today, the 10-year yield touched 2.32%, the lowest level since late 2017
    • The yield on the 30-year bond touch 2.76%, the lowest level since early 2018
  • Both have rallied strongly with yields, that move inverse to prices, plummeting

 

US Treasury 10-Year Yield - 6 Months

us 10 year yield

Source: Bloomberg

 

  • Who needs the Fed? (nothing personal, Mr. Powell) 

 

  • Scared investors are doing what the Fed has yet to-lower rates
  • The trade conflict has ramped higher over the preceding week, fueling the bond rally
  • It is possible tensions could grow further and with it investor fear
  • With stocks not far from all-time highs, another strong risk-off move could send yields even lower than there are today

 

 

 

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Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS