Liquidity remains tight despite temporary easing from Treasury paydowns, leaving funding markets sensitive ahead of Wednesday’s Fed meeting.
The bond market is signaling a possible shift toward higher long-end rates, with technical patterns suggesting that 30-year yields could accelerate toward the 5 percent region. Liquidity remains tight despite temporary easing from Treasury paydowns, leaving funding markets sensitive ahead of Wednesday’s Fed meeting. If forward rate structures continue firming, markets may begin pricing in a higher policy-rate path for 2026, challenging expectations for aggressive easing.
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