U.S. Treasury yields plummeted Tuesday morning following prepared remarks by Federal Reserve Chairman Jerome Powell for a congressional hearing, in which he warned that the economic recovery “is far from complete.”
The yield on the standard 10-year treasury note dropped to 1.645% at 05:30 ET. The return on the 30-year treasury bond fell to 2,346%. Yields move inversely to prices.
Powell and Finance Minister Janet Yellen will make their first joint appearance before the U.S. House Financial Services Committee on Tuesday at 12 noon ET to discuss their response to the coronavirus pandemic.
In prepared remarks, issued Monday afternoon before the congressional meeting, Powell said the economic recovery from the pandemic ‘has progressed faster than generally expected and looks set to intensify’.
However, he said that the sectors of the economy hardest hit by the pandemic ‘remained weak’ and that the unemployment rate ‘underestimated the deficit’, and the recovery thus left a long way to go.
Meanwhile, Fed Governor Lael Brainard will deliver a speech on the US economic outlook and monetary policy at the National Association for Business Economics annual economic policy conference at 3:45 p.m. ET.
The sale of new homes for February should be at 10:00 a.m.
Auctions will be held Tuesday for $ 34 billion of 52-week accounts, $ 40 billion of 42-day accounts and $ 60 billion of 2-year notes.