Fed Chair Warsh's Hawkish Stance Eases Treasury Yields; 10-Year Falls to 4.37% Despite 4.1% PCE Inflation

According to Steven Blitz, chief economist at GlobalData TS Lombard, Fed Chair Kevin Warsh's hawkish commitment to the 2% inflation target eased the U.S. Treasury market on Friday, June 26. The 10-year yield fell to 4.37%, a five-week low, after Warsh signaled he will not cut rates to appease the White House or allow inflation to rise unchecked. However, May's core PCE inflation climbed to 4.1%, marking the highest level since April 2023 and remaining well above the Fed's 2% goal. Market confidence was bolstered partly by data meeting expectations and a retreat in oil prices, which have fallen to pre-Iran conflict levels around $70 per barrel.
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