Interest Rate Update – January 2019

The 10-year benchmark US Treasury (US10Y) closed today at 2.714%. Rates have dropped as low as 2.55% in January, returning to similar rates as we saw in January and February of 2018. Q4 of 2018 saw the US10Y rise to its one year high of 3.23%. After peaking in mid-October it has been a steady decline back to the mid 2% range.

With talks of trade agreements between the United States and China still far from resolved, combined with the European Central Bank (ECB) talking about growing risks in their economy and subsequently driving down their 10-year bond yield, plus the current United States government shutdown, expect the US10Y to remain low for the time being as investor look for safety.

2019 will not be short of headlines that keep interested eyes on US Treasuries. Investors still remain optimistic in this extended bull market, and investment experts expect them to remain aggressive until a more clear signal of a recession arises.