Treasury yields fall as traders absorb key housing data

Treasury yields fell again on Wednesday, as markets absorbed housing sector data and paid close attention to earnings reports, scanning the numbers for hints about a looming recession.

Tea 10-year Treasury yield was last down by close to 8 basis points to 4.03%. The benchmark note has come off the 14 year highs it was trading around just last week, when it soared as high as 4.3%.

The yield on the policy sensitive 2-year Treasury was last at 4.427%, having declined by about 4 basis points.

Yields and price move in opposite directions and one basis point equals 0.01%.

Investors absorbed US new home sales data for September, which fell 10.9% in September from the prior month to a seasonally adjusted annualized rate of 603,000 units, according to the Commerce Department. It was better than the expected 13.4% decline to 593,000 units, according to consensus estimates from the Dow Jones.

In August, the figure had hit a five-month high, coming in above market expectations.

However, data published last week showed existing home sales had declined in September. Talks about a housing recession have been spreading as the sector is highly sensitive to interest rates.

The Federal Reserve has consistently been hiking rates in an effort to push back against persistent inflation, with a further 75 basis point hike expected to be implemented at the central bank’s next meeting on Nov. 1 and 2. Some investors have been concerned about the impact this may have on the US economy.

Traders have therefore also been paying close attention to earnings reports and estimates for the coming months, as they scan them for hints on companies’ economic outlooks. Among those reporting on Wednesday are Meta and Coca Cola.

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