What is the 30-year Treasury yield doing right now?
The 30-year Treasury closed at 5.20% on Thursday, August 27, just off the 5.33% level it hit on August 18, the highest print since 2007. The 10-year sits lower at 4.68%. The long end of the curve has been the pressure point all month, not the short end.
Why has the long end sold off this hard?
Three things are stacked on top of each other: inflation that will not fully cool, a wave of long-dated bond issuance funding a growing deficit, and a market still working out how a new Fed chair runs the institution. None of these resolve on a single data print. That is part of why this has been a grinding move higher, not a single spike.
What did the last CPI print show?
Headline CPI rose 3.4% year over year in July, down a tenth from June's 3.5%, with core CPI at 2.5%. That is cooling, but still well above the Fed's 2% target. It is exactly why the long end is not pricing a fast return to lower yields.
What is Kevin Warsh doing at Jackson Hole today?
Warsh delivers his first keynote as Fed Chair at 10:00 AM ET today. Reporting ahead of the speech frames it as a high-altitude address on productivity, demographics and the shocks hitting the global economy, not a line-by-line rate signal. Markets are treating it as the first real read on how he frames the job.
What are the Fed's task forces actually reviewing?
In July, Warsh named the leadership of five task forces covering monetary policy communication, the balance sheet, economic data, productivity and employment, and the inflation framework. The inflation group includes Harvard's Greg Mankiw and NYU's Thomas Sargent. Warsh has said he expects most groups to report by year end.
What does this mean for the trade?
A Fed chair using his first big platform to talk productivity and demographics instead of the next rate decision is itself information. It signals the review process matters more to Warsh right now than tactical guidance. The bond market has already been pricing structural concern, deficits, supply, sticky inflation, for weeks. Today's speech does not need to land dovish or hawkish to move yields. It just needs to shift how fast the market thinks the framework review lands.
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