The very short end of the yield curve continues to behave erratically. My best guess to its cause is still the concerns relating to the fiscal cliff. Nonetheless, the yield curve as a whole shifted up today. That shift might be attributed to the following action by the Federal Reserve chairman, as noted in a Bloomberg news article (link here):
“The yield on the 10-year Treasury note climbed to 1.67 percent from 1.61 percent as Bernanke’s comments suggested that a fiscal deal could remove impediments to growth. Stocks erased losses, with the Standard and Poor’s 500 Index advancing 0.1 percent to 1,387.82 at the close of trading in New York after losing as much as 0.7 percent.”
Newsmap (website link here) suggests that the “hottest” news at around 3 P.M. today are Twinkies, Chinese political news, and something positive relating to the fiscal cliff situation. I only included business news in the filter. For those of you that have never heard of Newsmap, here’s the description from the creator’s blog (link here):
“Newsmap is an application that visually reflects the constantly changing landscape of the Google News news aggregator.”
Thus, it appears the change in the yield curve today is due to two pieces of news – one affecting the very short end and the other affecting the longer end of the curve.
