Treasuries fell as the U.S. prepared to sell $27 billion of two-year notes at the highest auction yield since 2011 with investors demanding a bigger premium with the Federal Reserve forecast to raise rates next year.
“The committee judges that it can be patient in beginning to normalize the stance of monetary policy,” the Federal Open Market Committee said today in a statement in Washington, removing a calendar-based phrase with language that gives it more flexibility
Russia intervenes in the ruble to try to slow a currency meltdown, plunging oil prices cause stress in the credit markets and deflation forces in the European Union and Asia threaten their financial stability.
The dollar rose against most major peers as investors speculate whether the Federal Reserve is moving closer to raising interest rates with the U.S. economy strengthening while inflation persists below the central bank’s target.
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The U.S. central bank shouldn’t be hasty in dropping a pledge to keep interest rates low for a “considerable time” to avoid premature policy tightening, said Federal Reserve Bank of Atlanta President Dennis Lockhart.