3m-10y yield spread

Quite of bit of Steepening ongoing in the Feds favored yield curve benchmark 3 month/10 year.Fed buying t-bills maybe one excuse for the move or is it Hawkish Fed and And Now Stronger macro-outlook causing the Yield curve to bear steepen? break it down bit further is it investor expectations for higher inflation,I don’t think so or better Economic growth,Quite possibly yes.

3m/10 year

From IFR news regarding t-bill purchase

For the week itself the scheduled highlight is the Fed. As mentioned, they will be in with daily RP’s as well as two rounds of term-RP’s. They will also be in with daily open-market operations as they reinvest maturing MBS holdings and as the begin their balance sheet expansion via the large-scale purchases of T-bills. The latter begins tomorrow(10-16) when the Fed will buy $7.5 bn in T-bills out to the one-year. They will conduct two such operation on a weekly basis to reach their $60 bn total over the next four weeks and then release a new schedule for the following four weeks’ of purchases.

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