During the previous week investors were digesting the latest macro data aiming to set expectations for the forthcoming FOMC meeting, which is scheduled for Wednesday, July 30th. The 10Y Treasury yields were moving between 4,32% and 4,44%, closing the week at 4,38%. The drop in yields during the second half of the week was impacted with a trade deal between the US and Japan. Negotiations with the EU are taking place during the weekend in Scotland, whose outcome will be known at the start of the week ahead.
Regardless of trade negotiations, the week ahead will bring a lot of currently important US macro data, as well as the FOMC meeting. Current expectations with 95% odds is that the Fed will keep interest rates unchanged in July. Also, it is expected that Fed Chair Powell will inform the public about the latest Feds members view on the US economic developments. In case of any information that the market still has not priced, the higher volatility will take place. For the week ahead, there is both probability for a further modest relaxation in yields, at least till the level of 4,35%, and also potential for testing of 4,4% for one more time.
Regardless of trade negotiations, the week ahead will bring a lot of currently important US macro data, as well as the FOMC meeting. Current expectations with 95% odds is that the Fed will keep interest rates unchanged in July. Also, it is expected that Fed Chair Powell will inform the public about the latest Feds members view on the US economic developments. In case of any information that the market still has not priced, the higher volatility will take place. For the week ahead, there is both probability for a further modest relaxation in yields, at least till the level of 4,35%, and also potential for testing of 4,4% for one more time.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.