| Wednesday, December 27, 2023 |
||||||||
|---|---|---|---|---|---|---|---|---|
|
MANAGING DIRECTOR: |
||||||||
|
US Treasury Market |
|||||||||||
| Date | 1 mo | 3 mo | 6 mo | 1 yr | 2 yr | 3 yr | 5 yr | 7 yr | 10 yr | 20 yr | 30 yr |
| 12/19/23 | 5.34 | 5.37 | 5.33 | 4.93 | 4.44 | 4.15 | 3.94 | 3.96 | 3.93 | 4.22 | 4.04 |
| 12/20/23 | 5.34 | 5.39 | 5.31 | 4.89 | 4.33 | 4.04 | 3.85 | 3.87 | 3.85 | 4.16 | 3.99 |
| 12/21/23 | 5.34 | 5.38 | 5.30 | 4.85 | 4.35 | 4.06 | 3.88 | 3.90 | 3.89 | 4.20 | 4.03 |
| 12/22/23 | 5.37 | 5.37 | 5.28 | 4.83 | 4.32 | 4.04 | 3.87 | 3.91 | 3.90 | 4.21 | 4.05 |
| 12/26/23 | 5.37 | 5.37 | 5.27 | 4.81 | 4.36 | 4.07 | 3.89 | 3.92 | 3.90 | 4.21 | 4.05 |
The data in the table above is static as of the time it was pulled, so rates may have changed. Treat all data in this table and PMR as indications only and availability is always subject to change. This information was pulled manually from sources we believe to be reliable. New source, as of 12/12/2022, Bloomberg, L.L.P. As of: close of business 12/26/2023.
Since 1/01/2006, the 10yr TSY yield has been as high as 5.30% on 6/12/2007 and as low as 0.51% on 8/04/2020. The 10yr recently approached that old 2007 high by peaking for this interest rate cycle at 5.00% on 10/19/2023. Since then, the yield has dropped 1.15% to 3.85% as of 12/20/2023, a big move for just a two-month period. Almost as equally impressive was the move up in rates that occurred just prior to the current rally. The two-and-a-half-month period from 7/31/2023 to 10/19/2023 saw the 10yr TSY go UP 1.04% from 3.96% to 5.00% (Exhibit 2).
As can be seen in the Bloomberg chart below (Exhibit 1), while there has been a large move down in rates over a short period of time, interest rates are still relatively high on a historical basis. Exhibit 3, the 10yr TSY Regression chart indicates this as well, showing the 10yr TSY still between 1 and 2 standard deviations above the mean.
Even though rates have come down rapidly in a short period of time and 6 Fed Funds cuts are currently priced into the market for next year, there are still attractive investment opportunities in the market that offer good spreads to TSY and have lagged the TSY rally. Please contact your Country Club Bank Capital Markets Group sale representative for further information.
Exhibit 1 (Source: Bloomberg, LP)
Exhibit 2 (Source: Bloomberg, LP)
Current Rates are between ONE and TWO standard deviations ABOVE the mean, suggesting that portfolio durations be gradually extended.
This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.
•Not FDIC Insured •No Bank Guarantee •May Lose Value