The US 10-year Treasury yield steadied near 4.27% on Monday after sliding almost 10 basis points in the prior session, as markets digested Fed Chair Jerome Powell’s dovish comments at Jackson Hole. Powell suggested a rate cut could be on the table at the Fed’s next meeting, stressing that the current policy is still “restrictive,” leaving room for adjustment.  Market odds of a September 25 bps cut climbed to 87%, up from roughly 75% a week earlier, with traders now eyeing Friday’s July PCE price index for further clarity.

Japan’s 10-year government bond yield hovered near 1.62% on Monday, its highest level since 2008, after BOJ Governor Kazuo Ueda signaled at Jackson Hole that conditions for another rate hike are strengthening. Ueda pointed to wage growth accelerating across more sectors as labor markets tighten, supporting the case for policy normalization. 

The US Dollar Index inched back toward 98 on Monday, recovering from a nearly 1% decline on Friday in the wake of Powell’s dovish tone. Powell emphasized that rate cuts may be approaching, highlighting persistent inflation pressures alongside growing labor market risks. 

Take a look at today's market analysis for more updates!