10-Year Treasury Yield Rises to 1.93% In Spite of Impeachment Vote

 

The U.S. House of Representatives has voted to impeach President Donald Trump. The two charges will be discussed in a Senate trial that is expected to take place in January 2020. As the Senate has a Republican majority, it is expected that President Trump will be acquitted of his charges. Though the markets have priced in this expectation and remain unmoved by these political events, positive Fed commentary on the economy caused U.S. 10-year Treasury yields to rise slightly yesterday across the curve to 1.92%.

 

 

Financial Stability Board warns that banks and asset managers should speed up transition from LIBOR. The FSB, a collection of regulators and central bank officials, said that there needs to be more “significant and sustained efforts” to adopt new benchmarks like SONIA and SOFR. This latest warning from regulators comes on heels of a similar warning by the Bank of England, who warned earlier this month that a failure to transition quickly could cause “financial and reputational risk.” There have been some signs of progress, in the US the first CMBS bond indexed to SOFR was issued- the new deal part of an initiative to provide support and liquidity to the still developing SOFR bond market.

 

 

Day ahead. Existing home sales will be released this morning at 10:00 AM. The release in October showed an increase, but November’s report from the National Association of Realtors is anticipated to show a decline to a seasonally adjusted number of 5.44 million. The weekly Fed balance sheet report will be released at 4:30 PM. The last Democratic presidential candidate debate of 2019 will be held at 8:00 PM with the remaining seven candidates. Large corporations like Nike and Rite Aid Corp. will be releasing their fiscal earning reports.