Investors expect lower Treasury yields in the second half of 2021
The U.S. government bond yields are believed by investors to continue to weaken in the second half of the year causing a sharp decline from the first quarter of 2021.
The U.S. Treasuries significantly dropped due to unexpected low employment turn out in April and May raising doubts on the benefits of the economic resumption. The report on the federal labor data for June comes out this morning.
Confusing signals from the Federal Reserve on inflation before it comes up with a new monetary stimulus have also wavered yields.
The benchmark U.S. 10-year yield, which moves inversely to price, was down roughly 30 basis points since its peak of 1.776% in March.
A survey of JPMorgan clients on June 14 showed short positions in Treasuries climbed to the highest since 2017 while Bearish positions declined but still above 52-week average.