US 10-year yields break 4%

<p>Aside from the psychological value, 4% isn't meaningful. We were above it on Friday for a time, so it's not particularly new. However if you zoom out and look at the weekly chart, a pair of highs come in at 4.09% and those are critical. There's also been a consolidation pattern below 4.338% since October and the danger is that it resolves to the upside.</p><p>Fundamentally, I find it hard to believe that we will get there because it came with 9% inflation previously and we are a long ways from there. To get through it, I think we would have to see emerging signs of a new inflationary regime and I haven't seen those yet.</p><p>For now, I think this is largely the turn of the calendar and flows related to cash raising. In any case, the US dollar loves it as it adds to gains and makes new session highs.</p>

This article was written by Adam Button at www.forexlive.com.