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Bessent's focus on 10-year US Treasury yield may let Fed off the hook

The article from Reuters discusses Scott Bessent's perspective on the U.S. Treasury yields, particularly focusing on the 10-year yield. Bessent, a former Soros Fund Management partner, suggests that the Federal Reserve might not need to cut interest rates in 2025 if the 10-year Treasury yield, which he closely monitors, remains stable or decreases. He argues that the market's expectation for rate cuts could be misplaced if economic conditions continue to support higher yields. Bessent also touches on the broader economic implications, including the potential for the Fed to maintain or even increase rates if inflation pressures persist, contrary to market expectations for monetary easing. His analysis implies a cautious approach to monetary policy, suggesting that the Fed might be let off the hook from aggressive rate adjustments if the yield curve and economic indicators align favorably.

Read the Full Reuters Article at:
[ https://www.reuters.com/markets/us/bessents-focus-10-year-us-treasury-yield-may-let-fed-off-hook-2025-02-06/ ]