Weekly Compass: A Capital Markets Update
Insights & Perspectives | December 5, 2016
Economy, Oil Drive 10-Year Treasury Yield to New High
The yield on the US benchmark 10-year Treasury note rose to a 17-month high Thursday, December 1, following the biggest monthly increase in November since 2009. The yield recently was as high as 2.48%. Selling was exacerbated by higher oil prices after the Organization of the Petroleum Exporting Countries (OPEC) reached a deal to curb the continuing oil supply glut. Higher oil prices tend to boost inflation expectations, which chip away at bonds’ fixed returns over time, and is a big threat to long-term government bonds.