Search ForexCrunch

The yield on the US 10-year treasury note fell to the lowest level in over two months in the overnight trade, as US inflation unexpectedly eased in February, validating Fed’s patient approach on interest rates.  

As of writing, the yield is trading at 2.61 percent, having hit a low of 2.59 percent in the North American session yesterday – a level last seen on January 4.  

The consumer price index (CPI) increased by 0.2 percent month-on-month in February. In annualized terms, price pressures rose 1.5 percent, the smallest gain since September 2016, missing the forecast of 1.6 percent.  

Further, the core CPI, which excludes the volatile food and energy components, increased 2.1 percent year-on-year, as opposed to 2.2 percent expected rise. Further, the CPI rose 0.1 percent, the smallest increase since August 2018, according to Reuters.  

The below-forecast inflation reading will give the US central bank more room to remain patient on raising interest rates.