- Today, stock traders rejected any attempt at a rebound, with treasury yields creeping back to multiyear highs and mounting concern that a hawkish Fed will increase the likelihood of a hard landing.
- The market halted a back-to-back rally on the 35th anniversary of the equity crash, making any calls for an imminent bottom appear elusive.
- Treasuries experienced renewed selling pressure as a result of higher global inflation readings, corporate deal hedging flows, and a poorly received US 20-year bond auction. The two-year yield rose to its highest level since 2007 as traders increased their expectations for the peak policy rate to be closer to 5%, up from a current range of 3% to 3.25%.
- Fed Bank of Minneapolis President Neel Kashkari stated that the central bank may pause rate increases at some point next year if policymakers see clear evidence of slowing core inflation. He did, however, state that he has seen no evidence to give him comfort that core prices are moderating.
- His counterpart in St. Louis, James Bullard, said it's good news that markets are pricing in anticipated hikes, emphasizing the importance of officials following through and implementing those increases to combat high inflation.
