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LONDON, March 16 (Reuters) – U.S. Treasury yields fell on Monday but remained above recent multi-year lows, after the Federal Reserve stepped in with sweeping measures to protect the economy in the face of the coronavirus outbreak.
Global central banks moved aggressively on Sunday to buttress a world economy that’s rapidly unraveling. The Fed slashed interest rates to near zero, pledged hundreds of billions of dollars in asset purchases and backstopped foreign authorities with the offer of cheap dollar financing.
In European trade on Monday, the yield on the benchmark 10-year Treasury yield was down 15 basis points at 0.81% , holding above recent record lows at around 0.32%.
Short-dated Treasury yields also tumbled around 15 basis points and were last trading at around 0.34%, after reaching their lowest since 2014 earlier this month at around 0.25% .
Analysts said trading was thin and it was difficult to read too much into market signaling, although a stronger picture would likely emerge when New York markets opened later on Monday and trading picked up.
“The Fed has now done a lot in terms of rates and QE (quantitative easing), but the question in markets is whether monetary policy can solve the problems being created by coronavirus,” said John Davies, G10 rates strategist at Standard Chartered Bank in London.
European stock markets were down and U.S. equity futures pointed to a hefty selloff when Wall Street opened . (Reporting by Dhara Ranasinghe, editing by Larry King)
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