U.S. government debt yields were higher Friday morning, as investors await comments from Federal Reserve Chairman Jerome Powell.
Market participants will closely monitor Powell's speech at the Jackson Hole symposium later in the session, hoping for clarity on monetary policy. It comes after minutes from the U.S. central bank's July meetingThe Fed's top official is scheduled to address an audience of policymakers and economists at around 10:00 a.m. ET.
As of Friday morning, Fed funds futures were pricing a likelihood of almost 90% for a 25 basis point rate cut at the September meeting, and between one or two further quarter-point rate cuts between then and the end of the year. Meanwhile, the widely watched 2-year/10-year U.S. yield curve — often monitored as precursor for recession —on Thursday. It was the third time in two weeks that the bond market yield had flashed recession red lights.
The 10-year Treasury bond has since pulled away from the 2-year yield, hitting a one week high of 1.66% Friday morning.There are no major Treasury bond auctions scheduled on Friday.
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