Treasury yields plunged after the CPI report, with the 10-year Treasury yield falling more than 18 basis points to 3.946% as traders bet the Federal Reserve would slow its aggressive tightening campaign that’s weighed on markets all year. The yield on the 2-year Treasury dropped more than 23 basis points to 4.395% (1 basis point equals 0.01%). The U.S. Dollar
, another recent pressure point for stocks, tumbled to its worst day since 2015 vs. a basket of other currencies.
“It certainly shows how much the markets been keyed about, worried about and wants to run on CPI if you get any sort of help here,” said John Briggs of NatWest. “It just brings up the idea of peak inflation, peak Fed...The Fed will slow and peak rather than continue to aggressively hike at 75 basis point as at a time.”
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The effect on the Dollar should get your attention, if nothing else...in any event, we've just gotten some potentially good news on the Inflation front.