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Nov 13, 2019

Bonds | Treasury Yields Report: Treasury yields fall after report says US and China trade talks have hit a 'snag'

Yun Li, Sam Meredith



Treasury yields fell on Wednesday after rekindled trade uncertainty fueled investor demand for safer assets like U.S. debt.
The yield on the benchmark 10-year Treasury note fell to 1.8843%, while the yield on the 30-year Treasury bond was also lower at around 2.36%.
U.S.-China talks have reportedly hit a snag over agriculture purchases and other issues, casting more doubt on what Wall Street had been hoping would be an already-curtailed trade agreement.
The Wall Street Journal’s report added that Beijing hopes to cut a deal that doesn’t look favorable to Washington and wants a way out of any agreement should tensions mount again in the future.
“We can always stop the purchases if things get worse again,” one Chinese official told the Journal.
Speaking at the Economic Club of New York on Tuesday, President Donald Trump said both sides were “close” to reaching a “phase one” trade deal but did not offer any details on where or when it might be signed.
He previously touted the progress between Beijing and Washington, saying last month that China had agreed to purchase U.S. farm goods worth somewhere between $40 billion and $50 billion.

Treasurys

TICKER COMPANY YIELD CHANGE %CHANGE
US 3-MOU.S. 3 Month Treasury1.577-0.0130.00
US 1-YRU.S. 1 Year Treasury1.571-0.0130.00
US 2-YRU.S. 2 Year Treasury1.636-0.0140.00
US 5-YRU.S. 5 Year Treasury1.689-0.0290.00
US 10-YRU.S. 10 Year Treasury1.886-0.0230.00
US 30-YRU.S. 30 Year Treasury2.362-0.0230.00
Trump also repeated on Tuesday an accusation of China “cheating” on trade, though he blamed the situation on past leaders of the world’s largest economy.
Washington and Beijing have imposed tariffs on billions of dollars’ worth of one another’s goods since the start of 2018, battering financial markets and souring business and consumer sentiment.
U.S. consumer prices rebounded more than expected in October and underlying inflation picked up. The U.S. consumer price index increased by 0.4% last month, compared to a gained of 0.3% estimated by economists polled by Reuters.
Fed Chair Jerome Powell will testify on the economic outlook before the Joint Economic Committee at around 11:00 a.m. ET. In prepared remarks, he said the path of Fed interest rates is unlikely to change as long as the economy keeps growing.

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