[1/2]Federal Reserve Board Chairman Jerome Powell answers a question during a press conference following a closed two-day meeting of the Federal Open Market Committee on interest rate policy at the Federal Reserve in Washington, U.S., November 1, 2023. REUTERS/Kevin Lamarque/File Photo Acquire Licensing Rights
NEW YORK, Nov 9 (Reuters) – Falling Treasury yields helped launch an explosive rebound in stocks and lifted U.S. government bonds from 16-year lows. Now some investors worry that further declines in yields could keep the Federal Reserve in a hawkish stance for longer, potentially hurting asset prices over the longer term.
The paradox highlights how the relationship between yields and financial conditions – factors that reflect the availability of funding in an economy and are watched closely by central bankers – has come into focus in recent months.
Surging Treasury yields sapped…
