US Treasury debt maturing in five years has rarely been this expensive relative to other maturities except when the Federal Reserve has dropped interest rates to zero, according to interest-rate strategists at Goldman Sachs.
The five-year Treasury yield at around 3.78% Wednesday remains near the high end of its range since early 2022 — the last time the low end of the Fed’s target for the US overnight lending rate was 0%. But a common relative-value calculation for bonds — in which a yield is evaluated relative to a pair of shorter- and longer-maturity tenors — shows the five-year is historically rich.
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