- Markets priced a 66.2% chance of at least a 25-basis-point Fed hike at the September 15-16 meeting, up from 39.6% a week earlier; the 2-year Treasury yield reached its highest level since February 2025.
- The 10-year Treasury yield rose to 4.798%, its highest level since January 2025, as renewed Middle East strikes lifted crude prices about 2% and reinforced inflation concerns.
- Gold futures fell for a third straight session and surrendered nearly all of their year-to-date gain as higher bond yields and prospective Fed tightening reduced demand for the non-yielding asset.
- The ISM manufacturing PMI fell to 54.6 from 55.6, while July job openings rose to 7.271 million but remained below estimates, tempering the session's initial yield rise.
Quotes
“It's not necessarily the level of yields that's concerning to markets on a day like this, it's the trend and the concern that if the trend persists, then it will start to bite more into how companies, how investors value companies, how investors discount those cash flows to put a price, a current price on whether that's shares, or real estate, or pick your asset”
“have work to do”