U.S. Treasuries gain ahead of March consumer price inflation, FOMC meeting minutes

The U.S. Treasuries traded higher Wednesday as investors wait to watch the country’s consumer price index (PPI) data, scheduled to be released today 12:30GMT respectively. To add to that, the 10-year auction and the Federal Open Market Committee (FOMC) meeting minutes, due later in the day will add further direction to the debt market.

The yield on the benchmark 10-year Treasuries fell nearly 1 basis point to 2.79 percent, the super-long 30-year bond yields remained also slipped nearly 1 basis point to 3.00 percent and the yield on the short-term 2-year slumped 1-1/2 basis points to 2.29 percent by 11:20GMT.

In the US, the latest the CPI data release for March will take center stage today. With yesterday’s core PPI having shown an increase of 0.3 percent m/m, a similar increase of 0.2 percent m/m is expected for the core consumer price index.

This would match the increase in February and its average pace over the last six months. However, the annual pace of core inflation is set to rise from 1.8 percent y/y to 2.1 percent y/y, not least as the large decline in mobile services prices in March 2017 will fall out of the annual calculation, Daiwa Capital Markets reported in its latest research.

Today we will also receive the Fed minutes from the latest FOMC meeting when policymakers decided to raise the Fed Funds Rate by 25 basis points to 1.50-1.75 percent.

Meanwhile, the S&P 500 Futures fell 1.08 percent to 2,626.00 by 11:25GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained slightly bearish at -96.20 (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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