U.S. Treasuries remain nearly steady ahead of Q4 2018 GDP, FOMC’s monetary policy decision

The U.S. Treasuries traded nearly steady during late European session Wednesday ahead of the country’s Q4 2018 gross domestic product (GDP) data, scheduled to be released today by 13:30GMT and the ADP non-farm employment change for January, due today at 13:15GMT.

Also, the Federal Open Market Committee (FOMC) is due to host the first monetary policy meeting of this year, today, at 19:00GMT, which will provide further guidance to the debt market.

The yield on the benchmark 10-year Treasury yield rose 1 basis point to 2.721 percent, the super-long 30-year bond yields remained flat at 3.043 percent and the yield on the short-term 2-year traded tad higher at 2.573 percent by 12:20GMT.

In the US, as the next phase of US-China trade talks get underway in Washington DC, the main focus will be the conclusion of the FOMC’s latest two-day meeting, accompanied by Chair Powell’s post-meeting press conference.

While there will be no change to policy, and there will also be no updated economic forecasts published this time around, Powell will likely adopt a more dovish tone than in December recognising heightened economic uncertainties around the turn of the year, including the impact of disruption from the government shutdown, Daiwa Capital Markets reported.

Powell might also use his press conference to provide new information on the Fed’s plans on balance sheet normalization. Data-wise, ahead of Friday’s payrolls figure, the ADP employment report will be closely watched, while pending home sales figures for December are also due, the report added.

Meanwhile, the S&P 500 Futures edged 0.40 percent higher to 2,650.88 by 12:25GMT, while at 12:00GMT, the FxWirePro's Hourly Dollar Strength Index remained neutral at -34.52 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex