U.S. Treasury yields fell on Tuesday morning, as the Federal Reserve is set to kick off its two-day policy meeting.
Tahir said this has three major implications: firstly, that inflation could be higher for longer. Secondly, he said "volatility could be triggered by changes in monetary policy, as markets are waiting and reacting to ever single announcement that the Federal Reserve makes."
Thirdly, Tahir said that if the Fed were forced to "slam the brakes" on accommodative on monetary policy to control inflation, that could result in aThis happened in 2013 after Fed Chairman Ben Bernanke hinted at the tapering of asset purchases, prompting a spike in bonds yields.Auctions are due to be held on Tuesday for $20 billion of 42-day bills and $61 billion of 5-year notes.
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