On Wednesday, Treasury yields rose, with the 10-year note reaching 4.612%, the 2-year note at 4.225%, and the 30-year note at 5.118%. This movement comes as traders await the producer price index (PPI) for June, which is expected to remain steady after a 1.1% increase in May. The core PPI, excluding food and energy, is projected to rise by 0.3%, down from 0.4% the previous month.
The recent consumer price index (CPI) showed a 0.4% decline in June, leading to lower expectations for a Federal Reserve rate hike in July.
Meghan Shue, chief investment strategist at Wilmington Trust, noted that core inflation suggests that rising energy prices have not significantly impacted overall inflation, and she expressed optimism about continued disinflation potentially allowing for a Fed rate cut by year-end