Treasury Yields Expected To Decline As CPI Data Is Digested

Treasury yields are likely to come back down once markets have fully digested today’s inflation data, Spartan’s Peter Cardillo says in a note. September’s headline figure slowed less than expected, while the core reading matched expectations. Yields shook off early weakness and are now rising, with the 10-year at 4.609%. Cardillo says that “today’s data shows that core rate inflation year over year may seal the fact that the Fed’s [may be] over with rate hikes.” For now, though, odds of a November hike are rising to 11% from 6% before the data release, in the CME’s FedWatch tool. Odds of a hold remain massively higher, at 89%.