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Treasury Market Sees No Rate Cut by Sept., 30-Year Treasury Yield Near 5%: The Yield Curve and “Real” Mortgage Rates
The 6-month Treasury yield, which is a good indication of rate hikes and rate cuts by the Fed within 2-3 months, is still glued to the underside of the Effective Federal Funds Rate (EFFR), which the Fed targets with its policy interest rates, and is thereby not yet predicting rate cuts within its vision of 2-3 months. Last year, on June 26, the 6-month Treasury yield (then 5.33%, matching the EFFR) started skidding in anticipation of the 50-basis point rate cut that the Fed announced on September 18. By July 25, so exactly a year ago, it had dropped by 18 basis points to 5.15%. By August 28, it had dropped by 50 ... (full story)