Bond Traders Eye Spending Data After 2026 Fed Hike Bets Send 2-Year Yields Soaring

3 articles · Updated · Bloomberg · Jun 21

This week’s US personal spending data is the next key test for Treasury traders deciding whether last week’s sharp hawkish repricing went too far.
2-year Treasury yields jumped as markets moved to price in a Federal Reserve rate hike in 2026 after Chairman Kevin Warsh’s first press conference.
Warsh’s pledge to restore price stability eased fears he would bow to President Donald Trump’s pressure for lower borrowing costs, reinforcing the market’s tougher rate view.
Oil prices are also in focus because any renewed energy-driven inflation could strengthen the case that the bond market’s shift toward higher-for-longer rates is justified.

Sources

Left100%

With the Fed abandoning forward guidance, are markets flying blind into a new era of interest rate volatility?

As Treasury yields hit multi-decade highs, are 'risk-free' bonds now the market's most dangerous bet?

Is the Fed's inflation battle misjudging AI's power to lower prices sooner than expected?