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10Y Real Yields Close On Early 2019 Highs, Supporting USD

US
  • Behind the current ~15bp increase in 10Y nominal yields from Friday’s close has been a 14bp increase in real yields.
  • At 86bps, 10Y real yields are close to the Jun 14 high of 88bps (just prior to the Jun FOMC after the WSJ indicated a shift to 75bp pace) with those levels last seen in early 2019, bouncing from close to zero in early Aug in a factor helping support further USD strength.
  • The sharp move higher sees real yields more strongly positive across the curve, something Barkin (’24 voter) has mentioned wanting to see a few times with him set set to speak again tomorrow.

US 10y real yields (white) and DXY index (yellow)Source: Bloomberg

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