Bills, bills, and yields

Market reports
Lawrence Kaplin
  • Fall in treasury yields causes further USD correction
  • Bill Gross: US recession in Q4
  • PMI activity in focus today
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Markets went risk-on yesterday afternoon as concerns in the Middle East eased, as well as yields on 10-year treasuries retreating off 5% after hitting that key level earlier in the day. USD also retreated as treasury yields fell after notable comments from legendary investment managers Bill Ackman and Bill Gross, who both made the call that the economy is slowing faster than current data is suggesting with the latter adding that he sees a US recession in the fourth quarter of this year, and that the Fed’s mantra of higher rates for longer is yesterday's news. USD could well be susceptible for further weakness should we see risk appetite continue to rise, as well as seeing further falls in US treasury yields.


Market rates

* Daily move - against G10 rates at 7:30am, 24.10.23

** Indicative rates - interbank rates at 7:30am, 24.10.23

Data points


  • None today.

Our thoughts

More job numbers from the UK this morning which showed that employment fell by 82,000 between June and August, marking the longest drop in jobs since the Pandemic and painting a further grim picture of the UK economy. PMI numbers will be in focus from Europe, UK, and the US, and will give us the first sign of economic activity for the last quarter of this year. Action in the bond markets will also be in focus, and should we see further declines in US treasury yields, then we are likely to see further weakness in USD which will be welcome news for USD buyers out there.

Chart of the day

The moves on US treasury yields were notable yesterday, especially after 10-year yields hit the 5% mark and then dropped with some gusto. Bill Ackman (CEO of Pershing Square Capital Management) and Bill Gross’s (Co-founder of Pimco) comments yesterday predict yields to drop on the basis that the economy is slowing faster than data is suggesting, and the latter suggesting that a US recession is coming in Q4. The Fed’s ‘higher for longer’ mantra may well be a thing of the past, and should we see further falls in yields then a further correction on USD cannot be ruled out.

Source: Bloomberg Finance L.P.

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