Are Bonds Headed Back To Extraordinarily Low Rate Regime?
Outside of some unmistakable influence resulting from Fed policy, longer-term Treasury Yields are decided by free market forces. Thus, this return to the realm of the TNX’s ultra low-rate regime is market-driven, whatever the reason. Is there a softer underlying economic current than what is generally accepted at the present time? Is the Trump administration pivoting to a more dovish posture than seen in campaign rhetoric? Are the geopolitical risks playing a part in suppressing yields back below the ultra low-rate “line of demarcation”?
Some or all of those explanations may be contributing to the return of the TNX to its ultra low-rate regime. We don’t know and, frankly, we don’t really care. All we care about, as it pertains to bond yields, is being on the right side of their path. And currently, the easier path for yields is to the downside as a result of the break of major support near 2.30%.
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Check out the Premium post at our new “all-access” site, The Lyons Share, for the specific important levels of potential support and resistance on the 10-Year Yield. If you find our charts and research that we share here helpful and enjoyable, check out The Lyons Share – we are confident that you’ll find a lot of value in the service.