Source: US Dept. of Treasury End of Day
• The Treasury yield curve flattened considerably this week with the ten year note declining 19 basis points to 0.71% while the five year note declined 14 basis points to 0.34%, and the two year note was unchanged at 0.21%.
• The Federal Reserve met last week and reaffirmed their stance to keep interest rates floored, Chair Powell attributed their position to persistent economic uncertainty and an increased potential for longer lasting, adverse effects due to the pandemic.
•Core CPI for May fell for a third consecutive month from and annual rate of 2.4% to an annual rate of 1.2%. While the Fed is very concerned about the possibility of deflation, household inflation expectations actually rose as a majority of price declines were demand driven rendering them unnoticed by the consumer.
