The U.S. 10-year Treasuries jumped Wednesday, tracking fears of an ongoing trade war, spiked by the imposition of trade tariffs by President Donald Trump over China, EU and other trading partners as well. Further, investors are also awaiting a host of speeches by the Federal Open Market Committee (FOMC) members Quarles and Rosengren and the 5-year auction, scheduled for today by 15:00GMT, 16:15GMT and 17:00GMT respectively.
The yield on the benchmark 10-year Treasuries slumped nearly 3 basis points to 2.85 percent, the super-long 30-year bond yields suffered nearly 2-1/2 basis points to 3.00 percent and the yield on the short-term 2-year also traded nearly 3 basis points lower at 2.52 percent by 11:10GMT.
Trade tensions continued to simmer after Chinese President Xi Jinping said Monday "in the West you have the notion that if somebody hits you on the left cheek, you turn the other cheek. In our culture we punch back," in front of an audience of corporate executives. Investors have tried to gauge China’s willingness to retaliate against the U.S.’s tariff and trade curbs because of fears that a tit-for-tat reaction could swiftly lead to a full-blown trade war.
Atlanta Federal Reserve bank president Raphael Bostic, in the overnight session also said that deeper trade tensions over the last week have raised the risks to the U.S. economy, adding that he may rule out a fourth rate increase for the year if the developing trade war gets worse.
Meanwhile, the S&P 500 Futures slipped 0.40 percent to 2,718.00 by 11:20GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained highly bullish at 113.42 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex


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