Treasury Yields Slide After Fed Governor Waller Calls For Fed Rate Cut: Closing Bell

Watch comprehensive cross-platform coverage of the U.S. market close on Bloomberg Television, Bloomberg Radio, and YouTube with Scarlet Fu, Vonnie Quinn, Tim Stenovec and Isabelle Lee.

Bond yields fell as Federal Reserve Governor Christopher Waller reiterated his case for a July rate cut, while data showed consumer expectations for inflation improved. Stocks wavered amid earnings. President Donald Trump signed the stablecoins bill in a win for the crypto industry.

Short-dated Treasuries led gains as Waller hinted he would dissent if his colleagues vote to hold rates steady in July. Bonds also rose as University of Michigan data showed consumers expect prices to increase at an annual rate of 4.4% over the next year, down from 5% in the prior month. The S&P 500 was little changed. The dollar edged lower, but notched an advance for the week.

Meantime, Waller said he sees no sign that inflation expectations are on the rise, which allows the Fed to move forward with rate cuts. He also restated the case the Fed should cut when policymakers gather later this month, given data suggesting the US labor market is “on the edge.”

Money markets still assign near-zero odds of a cut on July 30. They price in about 45 basis points of easing by year-end, down from more than 65 basis points at the start of the month.

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