Squared Conversation
Timestamps
What Happened Last Week – 00:17
What’s Happening Next Week – 3:45
Squared Portfolio Update
Squared Comments
Squared Conversation
Timestamps
What Happened Last Week – 00:17
What’s Happening Next Week – 3:45
Squared Portfolio Update
Squared Comments
2 Responses
Hi Nick,
Could you explain the logic of why rates in the long part of the curve are increasing after the Fed’s decision? I am no bond trader, but my basic understanding tells me that both inflation and growth expectations decreased, and should be taking the long bond yields lower?
Novice here too, but inclined to take a shot. Perhaps since they cut 50 and are expecting higher unemployment, it signals that they care greatly about ensuring the labour market stays strong, implying that whilst rates are coming down faster than projected in June, the longer term rate will need to remain higher since they want to be sufficiently accommodative to the economy and labour market. Thus higher long-term rates put pressure on long-term bonds.
Curious for Nick’s answer.