Daily Market Color November 17, 2022U.S. Yields Rise after Bullard Suggests 5% – 7% Fed Funds Rate Treasurys suffer as odds of a Fed pivot fade. Yields opened the session higher after St. Louis Fed President James Bullard said that rate hikes have had “limited effects” on inflation so far, while adding that the zone for the fed funds rate could be in the 5% – 7% range. Meanwhile, Minneapolis Fed President Neel Kashkari said that “we cannot be overly persuaded by one month’s data,” which only added to the hawkish sentiment. As a result, the 2-year yield rose ~9bps to 4.45%, while the 10-year yield increased ~8bps to 3.77%. Equities were also stressed, with the S&P and NASDAQ both falling slightly over 0.30%. New tax increases and spending cuts in U.K aim to manage rising government debt. After a strongly negative market reaction to Liz Truss’s tax cuts, Chancellor Hunt announced a $66 billion package of tax hikes and spending cuts as Rishi Sunak’s administration works to reassure investors that the U.K. is addressing their large budget deficit and looming economic challenges. This is the first major Western economy to limit spending after years of pandemic-related stimulus and highlights the economic challenges that all countries face. Markets remained calm after the announcement, with only a slight move in the pound by 1% relative to the dollar, and a 7bp increase in the 10-year Gilt yield to 3.22%. U.K. equities rose, having already largely priced in the effects of the package. Day ahead. Existing home sales for the month of October will be released at 10:00 AM ET. Neutral Fed voter Susan M. Collins is scheduled to make comments at 8:40 AM.