1. Powell's hawkish pivot implies potential future rate hikes. 2. Market expects 60% chance of a rate cut in May. 3. TMUBMUSD02Y yields fell to 3.59%, signaling market sensitivity. 4. Longer-term inflation expectations are becoming a concern. 5. Powell's language change hints rate hikes are not off the table.
The shift towards a more hawkish tone could indicate future interest rate increases, which typically dampens demand for bonds like TMUBMUSD02Y, thus pushing prices lower.
The article highlights crucial changes in monetary policy stance, which are highly relevant to TMUBMUSD02Y's performance.
Given the immediate implications of Powell's statements on interest rates, the impact is likely to be felt in the short-term, particularly as markets digest this information rapidly.