When asked about the US Treasury bond market turmoil, FOMC Chairman Jerome Powell refrained from commenting specifically on bond yields and said that they would be concerned “by a persistent tightening of financial conditions broadly.”
Following these comments, the benchmark 10-year US Treasury bond yield shot higher and was last seen gaining 2.6% on the day at 1.527%. Consequently, the US Dollar Index gained traction and is currently rising 0.37% at 91.28.
Assessing Powell’s remarks, “the world’s most powerful central banker has spelled out his last words before the blackout period – and markets have undoubtedly noticed,” said FXStreet analyst Yohay Elam. “Powell refrained from using his power and only said that recent bond jitters “caught my attention”- paraphrasing his colleague Lael Brainard.”
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