U.S. Treasury yields were lower on Tuesday as markets digested consumer sentiment data showing decreased inflation expectations.
also slid 3 basis points to 3.536%. Yields move inversely to prices, and a basis point is equal to 0.01%.The New York Fed's Survey of Consumer Expectations showed that in August Americans expected inflation to be 5.7% one year ahead. That is down from 6.2% in July and the lowest reading since October 2021.
On the data front, investors will be watching the release of the U.S. year-on-year inflation and core inflation rates, and August's month-on-month inflation rate. Markets are pricing in a 9 in 10 chance that the Federal Reserve will hike interest rates by 75 basis points for a third time next week, but the bonds markets are essentially signaling that markets do believe that the inflation trajectory is heading lower.
Prices for energy, used cars and even food have gone down slightly. But there is a key difference between inflation in goods and in services, Cesar Perez Ruiz, chief investment officer at Pictet Wealth Management, told CNBC's "
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