coronavirus

Treasury Yields Fall Following Fed Chair Powell's Comments on the Economy

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  • Fed Chair Powell and Treasury Secretary Janet Yellen made their first joint appearance in front of the U.S. House Committee on Financial Services on Tuesday to discuss their response to the coronavirus pandemic.
  • Powell said that the economic recovery from the pandemic had "progressed more quickly than generally expected and looks to be strengthening."
  • However, he said that the sectors of the economy hardest-hit by the pandemic "remain weak" and the unemployment rate "underestimates the shortfall," so the recovery still had a long way to go.

U.S. Treasury yields ebbed lower on Tuesday, following comments from Federal Reserve Chairman Jerome Powell for a congressional hearing in which he warned the economic recovery was "far from complete."

The yield on the benchmark 10-year Treasury note fell to 1.615% in afternoon trading, a decline of more than six basis points. The yield on the 30-year Treasury bond dipped more than 5 basis points to 2.326%. Yields move inversely to prices. (One basis point is equal to 0.01%.)

Powell and Treasury Secretary Janet Yellen made their first joint appearance in front of the U.S. House Committee on Financial Services on Tuesday to discuss their response to the coronavirus pandemic.

Powell said that the economic recovery from the pandemic had "progressed more quickly than generally expected and looks to be strengthening."

However, he said that the sectors of the economy hardest-hit by the pandemic "remain weak" and the unemployment rate "underestimates the shortfall," so the recovery still had a long way to go.

The decline in yields also comes amid rising worries about a slowdown in the economic reopening. The decline in Covid cases in the United States has seemingly paused, while some European countries have reimposed lockdowns to stem the spread of the virus.

New home sales for February were down 18.2% month over month, according to data released by the Census Bureau on Tuesday.

Auctions were held Tuesday for $34 billion of 52-week bills, $40 billion of 42-day bills and $60 billion of 2-year notes.

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