Losing a clear direction, the market fell into hedging sentiment in the short term 😶🌫️
In addition to the debt ceiling negotiations, Chairman Powell noted in the interview that the FOMC "has made a lot of progress on policy tightening" and emphasized that "as policy becomes more restrictive, the risk of doing too much/too little becomes greater." Becoming more balanced", in addition, he emphasized that the FOMC can make decisions "taking into account data and the changing outlook" on monetary policy.
Even though it was during an interview, Powell chose to read his responses very carefully from a prepared set of notes, taking special care not to miscommunicate information. With no clear indication that policy might be tightened next month, short-term interest rates reversed sharply, with the probability of a rate hike in June falling to about 15%. Bonds recovered about half of the day's losses, with the 2-year yield remaining at 4.27%. The 2/10s yield curve inversion has steadily remained at -60 basis points.
In addition to the debt ceiling negotiations, Chairman Powell noted in the interview that the FOMC "has made a lot of progress on policy tightening" and emphasized that "as policy becomes more restrictive, the risk of doing too much/too little becomes greater." Becoming more balanced", in addition, he emphasized that the FOMC can make decisions "taking into account data and the changing outlook" on monetary policy.
Even though it was during an interview, Powell chose to read his responses very carefully from a prepared set of notes, taking special care not to miscommunicate information. With no clear indication that policy might be tightened next month, short-term interest rates reversed sharply, with the probability of a rate hike in June falling to about 15%. Bonds recovered about half of the day's losses, with the 2-year yield remaining at 4.27%. The 2/10s yield curve inversion has steadily remained at -60 basis points.