Investors dump Treasuries after strong wage data

Financial Times/Joe Rennison and Nicole Bullock/11-2-2018

“The 30-year Treasury yield climbed to a four-year high on Friday, after accelerating wage growth fanned fears over faster Federal Reserve interest rate increases and added to a deepening bond market sell-off.”

USAGOLD note:  The strong jobs report also stated a 3.1% increase in average wages – a strong number that indicates inflationary pressure beginning to build in the economy. It’s that part about “deepening” the bond market sell-off that will be worrisome to Wall Street. All eyes will be on next week’s record sale of U.S. sovereign debt the results of which could bleed over to the stock market. Please see below.

Higher hedging costs threaten US debt auctions/NewsMax/11-2-2018

“The U.S. government’s debt sales to raise $29 billion of fresh cash next week face uncertainty about foreign demand as the cost to hedge dollar-denominated assets recently hit a 2018 high for European and Japanese investors.The U.S. Treasury Department said on Wednesday it will sell a total of $83 billion of fixed-rate securities including record amounts of 10-year and 30-year debt next week as a part of its quarterly refunding.”

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