Treasury yields tumble as Fed sticks to rate rise forecast

Listen to this article

00:00
00:00

Whoosh.

Treasury yields are falling hard on Wednesday after Fed policymakers stuck with previous median projections that there will be a total of three increases in rates this year.

The move confounded predictions from some bullish analysts that it would release a more aggressive set of rate-raising forecasts and triggered a sharp rally in US government bonds.

Yield on the 10-year Treasury note, which moves inversely to price, fell by as much as 8.9 basis points to 2.511 per cent, its biggest intraday drop in two months. The 2-year yield was down 4.6 per cent at 1.330 per cent.

The dollar – as measured by the DXY index – fell 0.2 per cent.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't copy articles from FT.com and redistribute by email or post to the web.