Talking heads were out in droves on Thursday speaking about the illiquid Treasury market and how it may soon crack – triggering the need for Fed intervention. Sure, yields are moving around as the Fed tightens. However, this past week’s movements in the 2-Year and 10-Year Treasury yields were not any more volatile than in previous weeks of 2022.
2-Year Treasury yields do not appear more volatile today as compared to the first half of February 2022 or the first half of June 2022 when one compares the daily percentage change in 2-Year Treasury yields (first chart).
The daily percentage changes in the 10 Year yield tell a similar story. In the case of the 10-Year Treasury yield, the downward movement in the 10-Year yield of late September was no more of an abrupt movement than those that occurred in early March 2022, mid March 2022, mid June 2022 and early August 2022 (chart below).
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