Lates News

Before Friday's release of the U.S. October employment report, bond traders have already bet that the U.S. Treasury market will rise further, while market expectations for the Federal Reserve to continue raising interest rates have continued to cool. After the U.S. midterm elections, global stock markets suffered a sell-off, driving investors to turn to U.S. Treasuries for safe haven this week, with the 10-year Treasury yield falling on Thursday to its lowest level since early September. As the stock market sell-off intensified further, the 10-year Treasury yield stood at 4.82% on Friday. The recent rally in the bond market has strengthened traders' confidence in further declines in yields. A trade in the options market bets that the 10-year Treasury yield could fall to 4.7% by the end of next week; another trade expiring on November 20 bets that the yield will fall to about 4.35%. Gennadiy Goldberg, head of U.S. rates strategy at TD Securities, said he expects Friday's data to be slightly weak, but the market is still mainly focused on economic fundamentals. He noted that the U.S. economy remains quite strong, with the labor market showing a "low hiring, low layoffs" state, so the market has already significantly reduced rate hike expectations over the past few weeks.