2-Year Note futures surged as cool CPI data cut yields
The 2-Year Note futures recovered sharply during Tuesday's session, bouncing back from contract lows established in the previous session to trade near the 103 handle. This upward price momentum was primarily catalyzed by lower-than-expected U.S. consumer price index data, with both core and headline CPI figures missing expectations. The cooler inflation data sparked a significant downturn in yields across the curve, with the 2-year yield dropping 8 bps to 4.18% after hitting an intraday low down 10 bps. Additionally, heavy buying in 6-month and 1-year instruments pushed shorter-dated yields down by 9 bps, creating a notable steepening dynamic despite quiet market reactions to the Fed Chairman's congressional testimony. Investors now shift focus to upcoming PPI data for further curve validation.
The 2-Year Note futures recovered sharply during Tuesday's session, bouncing back from contract lows established in the previous session to trade near the 103 handle.
This upward price momentum was primarily catalyzed by lower-than-expected U.S. consumer price index data, with both core and headline CPI figures missing expectations.
The cooler inflation data sparked a significant downturn in yields across the curve, with the 2-year yield dropping 8 bps to 4.18% after hitting an intraday low down 10 bps.
Additionally, heavy buying in 6-month and 1-year instruments pushed shorter-dated yields down by 9 bps, creating a notable steepening dynamic despite quiet market reactions to the Fed Chairman's congressional testimony.
Investors now shift focus to upcoming PPI data for further curve validation.