US 10 year yield
US 10 year yield is down 6 of 8 days now

The US 10 year yield moved to a intraday low of 2.584% today. That move took the yield closer to the next target at 2.53% to 2.557% (swing high from March 28 and swing low from April 7 before the run higher).

The price has now moved down 6 the last 8 trading days after peaking at 3.081% on July 21. From that high to the low today, the yield has moved down -50 basis points. Recall last week the FOMC raise rates by 75 basis points.

Helping the US move down in the face of a continuing Fed hike policy is a lowering of inflation expections (and perhaps fears of a recession). The ISM and PMI price info today saw sharp moves lower. Oil is down. Commodities are also moving lower. Today the first ship with Ukraine crops was able to head out of port due to UN efforts to free up commodities to countries in dire need.

  • Corn is trading near closing levels from end of year 2021 at 600 after trading as high at 824 at the end of April.
  • Wheat is trading at 794 after closing the year at 770. The high reached 1363 in March.
  • Soybean futures are at 1403 after trading as high at 1789 in June. The end of year close was at 1339.
  • Lumber futures are at 532 well below the end of year close of 1122><> The price traded at the lowest level since August 2021 and down from the high of 1357.

Also helping is the positive spread between the US 10 year and the German 10 year yields. It currently is around 183 basis points. Back in mid June, the yield spread was only around 150 basis points. As a result, flow of funds into the US are attractive to global investors relative to a mid June.

German 10 year yields have moved down from an intraday high of 1.90% to the current 0.78%, while US yields have moved from 3.5% to the low at 2.58% today.

US German yield spread
The 10 year spread between US and Germany.