Treasury yields flat lined ahead of Fed and BOJ

Treasury yields are flat lined in Asia as investors await Bank of Japan (BOJ) rate decision which is largely seen shaping the future for monetary policies across the advanced world.

FOMC rate decision is due as well, although markets do not see the bank raising rates any time soon. Nevertheless, investors would keep an eye on the ‘interest dot chart’. Moreover, the fed could start building ground for a December move via interest rate dot chart.

At the time of writing, the benchmark 10-yr treasury yield was up just one basis point at 1.707%. The 2–year yield which mimics short term interest rate expectations was largely flat around 0.782%.

The muted action in the treasury yields is likely to continue ahead of the BOJ rate decision. There are growing fears that bond market volatility may spike if the BOJ comes up with its own version of the operation reverse twist.