- The Fed lifted the fed funds rate to a range of 3.75% to 4% on Sept. 16, the first increase since July 2023, as fighting inflation became the central bank's priority.
- The 10-year Treasury yield topped 5% on Sept. 15, its first close at that level since 2007, and has since eased to 4.947%; the yield is up 21% over the past 12 months.
- Consumer Price Index readings have stayed well above the Fed's 2% target, pushed by higher energy prices since the Iran war began in late February.
- Treasury Secretary Scott Bessent's buybacks of long-dated Treasuries have not calmed market worries about the sustainability of the $40 trillion federal debt burden.
- HSBC says it built a machine-learning model with 65% accuracy to predict the direction of the 10-year Treasury, the most important financial instrument in global markets.
Quotes
“On Sept. 16, the Kevin Warsh-led Federal Reserve raised the federal funds rate by a quarter of a percentage point to a range of 3.75% to 4%.”
“The U.S. 10-year Treasury yield topped 5% on Sept. 15 (it has since fallen to 4.947%).”
“HSBC says it’s designed a machine-learning model to predict the direction of the most important financial instrument in global markets.”