Minutes from the Fed’s July 28-29 meeting showed that many Federal Reserve officials believe rate hikes will be necessary if inflation does not decline. The vote to keep the key rate unchanged at about 3.6% was 9-3. Underlying inflation remains elevated, with core PCE expected at 3.3% in July, compared to 2.5% for CPI. The yield on 10-year Treasury notes reached its highest level in over a year, topping 4.7%, while the 30-year bond yield hit its highest level since 2007. In response, the Treasury Department announced it would buy back longer-term bonds to lower yields.
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