Us yields higher by year end regardless of Fed? - ANZ

Analysts at ANZ explained that while the latest disappointing payrolls report has not derailed expectations that the Fed will hike again next week (we still hold that view too), it has certainly added to questions over the extent of any future tightening (and longer-term yields more generally).

Key Quotes:

"Especially as it comes at a time when there are some signs that core inflation is rolling over again."

"We still see US yields higher by year end (and believe the market is under-pricing the Fed), but with Comey testimony, the UK election and the ECB meeting all this week, we doubt the market will want to run with that."