Treasuries Extend Decline on Powell Dampening Rate Cut Bets – Europe Market Wrap

Bonds declined and the dollar climbed as Federal Reserve Chair Jerome Powell pushed back against the prospect of lower interest rates.

US 10-Yr rates rose seven basis points to 4.09%, extending moves that began on Friday following the huge jobs report. Yields on Treasuries from Australia to Germany increased.

Meanwhile, global stock markets were uneven, with S&P 500 futures in the United States falling and European shares rising.

Powell’s statements reduced the likelihood of a quarter-point rate cut in March to nearly 10%, despite the fact that just four weeks ago, investors thought such a move was considered a near certainty.

OECD sees the Fed cutting rates in Q2, ECB in Q3, but adds policy stance should remain restrictive for some time.