Reassurance – COOPER GENERAL NEWS

The US 10-year Treasury bond yield surged over 1.7% Thursday, despite assurances from the Federal Reserve that it had no plans to hike interest rates or curtail its bond-buying program anytime soon.

The yield on the 10-year benchmark Treasury note rose 9 basis points to 1.71% by 11:00 a.m.CET. The yield on the 30-year government bond rose 4 basis points to 2.478%. The returns move in reverse to the prices. (1 basis point corresponds to 0.01%.)

The 10-year price was above 1.75% at the start of the meeting, reaching its highest level since January 24, 2020, when it peaked at 1.762%. This is also the first time since August 2019 that the 30-year-old has traded above 2.5%.

Peter Kraus, CEO of Aperture Investors, said in CNBC’s “Squawk Box” that interest rate hikes in recent months reflect growing confidence in the economic outlook.

“Rising interest rates from the level they were at do not mean financial tightening,” said Kraus. “This means that the economy is growing, that some price increase is expected and that companies that can benefit from higher prices and increased economic activity will also do well in terms of price increases in the market.”

After the Fed’s two-day political meeting concluded on Wednesday, the central bank announced that it sees stronger economic growth than previously thought and forecasts that gross domestic product will rise to 6.5% in 2021. This corresponds to a forecast of 4.2% GDP growth in December.

The Fed also expects core inflation to hit 2.2% this year, but expects it to stay around 2% over the long term. The central bank also said it has no plans to raise interest rates until 2023 and that it will continue its program of buying bonds worth at least $ 120 billion a month.

These projections confirmed the idea that the Fed is ready to let the economy run hot for a period of time so that the US can recover from the Covid pandemic. Bond investors fear that this means the central bank is pushing inflation higher than normal, which is undermining the value of bonds.

Fed Chairman Jerome Powell reiterated that the central bank would like to see constant inflation above its 2% target and a substantial improvement in the US labor market before considering changes in interest rates or monthly bond purchases.

Quilter Investors’ portfolio manager Hinesh Patel said on Wednesday following the Fed policy decision, “While no response is the only move offered, whatever Powell is doing at this point, the Fed is putting bond markets in danger.”

“If they don’t do anything, the bond market will continue to drive yields higher so the Fed can increase or adjust bond purchases. If it acts now, it will be accused of over-stimulating and getting too hot,” said Patel.

However, Willem Sels, chief investment officer, private banking and wealth management at HSBC, said the Fed’s message of a gradual normalization of policy meant that this was “a very different situation from 2013, when bond rejuvenation surprised the market and led the real The return is increasing rapidly and significantly, leading to stocks, gold and risk-weighted assets being sold. “

There have been some concerns that the recent surge in bond yields and inflation expectations could mark a repeat of the 2013 “tantrum”. That was when government bond yields suddenly spiked on the market panic after the Fed announced it would curtail its quantitative easing program.

Initial jobless claims for the previous week were below the expected 770,000, but the Philly Fed survey of the production outlook was better than expected.

Auctions are scheduled for Thursday for four-week bills worth $ 40 billion, eight-week bills worth $ 40 billion, and nine-year 10-month inflation-linked government bond securities worth $ 13 billion.

– CNBC’s Thomas Franck contributed to this report.

WASHINGTON – On his first official trip from Washington since taking office, President Biden reassured Americans Tuesday of the availability of coronavirus vaccines and optimism that his $ 1.9 trillion relief bill was an ambitious plan to restore the American economy could.

“Now is the time we should be,” he said at a CNN town hall in Milwaukee, promoting a plan that previously has no Republican support in Congress. “Now is the time to grow up.”

Regarding the coronavirus, he said any American who wanted a vaccine could get one “by the end of July this year,” which sounded more optimistic than last week when he warned that logistical hurdles would most likely mean many Americans would be by the end of Not vaccinated in summer.

“We’ll have over 600 million doses – enough to vaccinate every single American,” he said at an event attended not only by his own supporters, but also by Trump voters and independents.

Mr Biden predicted that “I think that by next Christmas we will be in a very different situation than we are today.”

The town hall’s question-and-answer format gave the president an opportunity to practice what has been his trademark personal politics for decades. For example, when an independent voter asked him how her son with a pre-existing illness could get the vaccine, Mr. Biden said to her, “If you’re ready, I’ll stay after this is over and maybe we can talk a few Minutes and see if I can help you. “

At another point, he comforted an 8-year-old girl whose mother said she was afraid of dying from Covid-19. “You are the safest group of people in the whole world,” he said. “I wouldn’t worry about that baby, I promise you that.”

Mr Biden expressed his condolences for the girl’s missed school days and said that his administration’s goal is still to open most schools to kindergarten students all day within her first 100 days through eighth grade.

The promise appeared to contradict White House press secretary Jen Psaki, who said last week that the government’s once-ambitious reopening target has been scaled back to ensure that more than 50 percent of schools have “at least one class” a day Week ”in the first 100 days. She later added, “We definitely hope to build on it after 100 days.”

But Mr. Biden was reluctant to lower the bar to one day a week in personal school. “That was reported,” said the president. “That’s not true. It was a mistake in communication.”

He also said he expected school to continue throughout the summer to allow students to catch up.

The trip to Milwaukee seemed like a make-up visit of sorts to the city that was slated to host the 2020 National Democratic Convention last summer before the coronavirus pandemic turned plans for face-to-face meetings upside down.

And the situation in a state he won by less than a percentage point in November made sense to a president promoting a plan to help Americans recover from the ravages of the pandemic.

Updated

Apr 16, 2021 at 10:43 am ET

A surge in coronavirus cases made Wisconsin one of the hardest hit states in the fall and early winter, although the numbers have dropped significantly. The state’s unemployment rate of 5.5 percent is also lower than double-digit highs seen in the early days of the pandemic, but is still higher than last winter.

On Tuesday evening, Air Force One landed in a Wisconsin excavated from a blizzard, and when the country’s attention finally turned more to Mr. Biden after the end of the second impeachment trial of his predecessor Donald J. Trump over the weekend.

Mr Biden continued his practice throughout his impeachment and seemed anxious to avoid mentioning his most recent predecessor. At one point he referred to Mr. Trump as “the former man”.

When asked by the moderator, CNN anchor Anderson Cooper, for his thoughts on the impeachment ruling against Mr Trump, Mr Biden said he wanted to move on. “For four years now, everything that’s on the news has been Trump,” he said. “For the next four years, I want to make sure that all news is the American people. I’m tired of talking about Trump. “

At one point, however, he couldn’t resist a veiled dig and told Mr. Cooper that all but one living former president had contacted him by phone to make it clear that it was only Mr. Trump who hadn’t.

When asked by Mr. Cooper how he got used to the presidency, Mr. Biden, who said on inauguration day that it felt like he was “coming home,” seemed humble about the experience.

For one, he was not used to living with a butler who helped him with his coat, as well as with other employees in the White House residence who were there to serve him. “I was brought up so that you weren’t looking for someone to wait for you,” he said. “I am very confident.”

Despite his close relationship with President Barack Obama, Mr Biden said he had never visited the private section of the White House residence before moving in last month. And he said life there is a great contrast to the Vice President’s residence, which has more space and privacy.

“It’s a bit like a gold-plated cage when you can go outside and do things,” he said of life in the White House. “I feel a sense, I have to tell you, a sense of story about it.”

Mr Biden repeatedly apologized when he felt his answers were too complicated or taking too long, and he hoped to lead the country in facing the challenges.

“I literally pray that I have the ability to do what you all deserve for the country,” said Biden.

Ms. Psaki said Tuesday that Mr. Biden hoped “to have a good conversation with people about the way forward and even with people who disagree with it” on the trip. In fact, one of the President’s most vocal critics is Senator Ron Johnson, the state’s Republican Senator, who is vehemently against the Biden bailout plan. But Ms. Psaki said pressure on Mr. Johnson was not the purpose of the trip.

When asked about the divisions in American society, Mr. Biden replied that the country was more unanimous than expected on the need for relief, and found that 69 percent of Americans supported his plan. “The nation is not divided,” he said. “You go out there and look around and talk to people, you have edges on both ends. But it is nowhere near as divided as we imagine. “

Outside the Pabst Theater, where the City Hall was taking place, a group of fast food and other low-wage workers planned a protest to urge Mr. Biden not to give up his promise to raise the minimum wage to $ 15 an hour.

However, the president was asked by several small business owners for his support for a minimum wage of $ 15 an hour, trying to reassure them that the increase would be gradual, as if to show that differences could be overcome. While “no one should work 40 hours a week living in poverty,” said Biden, “it’s perfectly legitimate for small business owners to worry about how this is changing.”

But he highlighted white supremacists as a unique threat to domestic terrorism that needed to be addressed. “I would make sure my Justice Department and Civil Rights Department have a strong focus on these people,” he said. “I would make sure that we actually focus on how to deal with the rise of white supremacy.”

Dan Simmons contributed to coverage from Milwaukee.