FED DUCKS A HIKE DESPITE HOT CPI AS GOLDMAN WARNS BOTH WINGS OF THE DISTRIBUTION HAVE GOT FATTER

What happened: Ten-year Treasury yields fell back below 5% after a 17bp one-day drop, the biggest single-day decline since March 2023, as the Fed declined to hike despite hot CPI data. Key numbers: 10Y yields retraced just over 30bp from highs; 17bp one-day plunge; first time below 5% in a month. Why it matters: Goldman's Cosimo Codacci-Pisanelli notes the AI capex boom and Iran war energy shock no longer push yields in the same direction, ending the partnership that had driven yields to multi-decade highs.

Ten-year Treasury yields fell back below 5% after a 17bp one-day drop, the biggest single-day decline since March 2023, as the Fed declined to hike despite hot CPI data.

Goldman's Cosimo Codacci-Pisanelli notes the AI capex boom and Iran war energy shock no longer push yields in the same direction, ending the partnership that had driven yields to multi-decade highs.