The U.S. Treasuries dived Tuesday as investors remain cautious ahead of the Federal Open Market Committee (FOMC) members Neel Kashkari and Patrick T. Harker’s speech, scheduled to be held later in the day.
The yield on the benchmark 10-year Treasury jumped 3 basis points to 2.45 percent, the super-long 30-year bond yield also surged nearly 3 basis points to 3.06 percent and the yield on short-term 2-year note traded 2 basis points higher at 1.22 percent by 10:50GMT.
President of the Federal Reserve of Philadelphia, Patrick Harker, said that a Fed rate step in March was not off the table. However, Harker also said that in his view the Fed was not yet behind the curve, which implies that the Fes is not late in tightening its monetary policy. So none of that suggests that the Fed would suddenly be in a rush to hike interest rates.
"Ongoing gains in the labor market have been accompanied by a further moderate expansion in economic activity. U.S. real gross domestic product is estimated to have risen 1.9 percent last year, the same as in 2015. Consumer spending has continued to rise at a healthy pace, supported by steady income gains, increases in the value of households’ financial assets and homes, favorable levels of consumer sentiment, and low interest rates," Yellen said in her latest testimony.
Lastly, markets will now be looking forward to the release of January consumer inflation and retail sales data, due to be released later in the day.
Meanwhile, the S&P 500 Futures rose 0.22 percent or 5 points to 2,353 by 10:50GMT, while at 10:00GMT, the FxWirePro's Hourly Dollar Strength Index remained highly bullish at 144.04 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex
