U.S. government bond yields posted their biggest weekly advance in more than six years, rising for five consecutive sessions after signs of a thaw in trade tensions eased fears about the direction of the economy. Government bond yields around the world have risen in recent sessions and employers continue to add workers and raise wages, contributing to consumer confidence and spending. Easing recession fears also helped power stocks higher, with the Dow Jones Industrial Average climbing in eight consecutive sessions, its longest streak of gains since May 2018. Optimism about the economic outlook has grown, as investors have tempered bets on the pace of interest-rate cuts from the Federal Reserve.
https://www.wsj.com/articles/treasury-yields-rise-erasing-much-of-august-decline-11568391190
Do you think that treasury bond yields are a good indicator of the economy, and that this surge is enough to avoid recession?
ReplyDeleteYes Lucas, when treasury yields increase so do interest rates, vice versa. So if interest rates increase so will the value of the dollar, which is a good indicator for the economy.
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