UST 2-year rate was down to 1.33% and 10-year down to 2.22% as FOMC minutes showed that several participants were ready to announce a starting date for shrinking the balance sheet; UST move likely to put downward pressure on local rates today

By Jason Wong

UST yields are lower across the curve, with the 2-year rate down 2bps to 1.33% and the 10-year rate down 5bps to a session low of 2.22%. 

The FOMC minutes showed that several participants were ready to announce a starting date for shrinking the balance sheet at that late-July meeting.  This adds to the chance that the Fed will make the announcement at its September meeting.

There was little change in the local rate curves yesterday, while the UST move this morning will put downward pressure on rates at the open.  Australian employment data will be the focus during the local session today, while the global calendar ahead only has second-tier releases.

Daily swap rates

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Jason Wong is on the BNZ Research team. All its research is available here.

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