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New Investor Worry: Treasury Selloff Spiking Interest Rates

Posted By admin On May 28, 2009 @ 4:10 am In Money Watch | Comments Disabled

Patti Domm
CNBC [1]
Thursday, May 28, 2009

The stock market is watching the bond market, wary a spike in interest rates will derail a fragile economic recovery and snuff the market’s rally.

Stocks tumbled Wednesday, but the real drama was in Treasurys and mortgages.

A selling spree in Treasurys pushed rates higher, taking the yield curve to its steepest on record as spreads between the 2-year and 10-year widened by over a dozen basis points on Wednesday alone.

The 10-year saw its yield move above 3.70 percent, after trading at 3.55 percent the previous day. The selling wave hit bonds shortly after 1 p.m., even after the auction of $35 billion in 5-year notes was well received.

“It was a great auction. It was just the follow through that was a problem,” said Brian Edmonds, head of interest rate trading at Cantor Fitzgerald.

Full article here [1]

New Investor Worry: Treasury Selloff Spiking Interest Rates 335x205 graph128c aj [2]

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URLs in this post:

[1] CNBC: http://www.cnbc.com/id/30968861

[2] Image: http://www.efoodsdirect.com/products.html

[3] Markets Are Falling, Interest Rates Are Spiking Again, And China Got DESTROYED: http://www.prisonplanet.com/markets-are-falling-interest-rates-are-spiking-again-and-china-got-destroyed.html

[4] Without Low Interest Rates, The U.S. Financial System Dies: http://www.prisonplanet.com/without-low-interest-rates-the-u-s-financial-system-dies.html

[5] Economist Predicts US Interest Rates To Explode To 3.75% This Year: http://www.prisonplanet.com/economist-predicts-us-interest-rates-to-explode-to-3-75-this-year.html

[6] Interest rates will go up quicker than anyone expects, ex-Bank of England officials warn: http://www.prisonplanet.com/interest-rates-will-go-up-quicker-than-anyone-expects-ex-bank-of-england-officials-warn.html

[7] What Is Going To Happen If Interest Rates Continue To Rise Rapidly?: http://www.prisonplanet.com/what-is-going-to-happen-if-interest-rates-continue-to-rise-rapidly.html

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