Citi strategists say strong PMI and hawkish comments make US Treasury buyers cautious

Citigroup strategist Jason Williams stated in a report that the US Treasury market is currently experiencing a mild buyer's wait-and-see attitude. He noted that last Wednesday’s strong PMI data has further intensified this situation, while statements made by Federal Reserve officials last week remain very hawkish, “which may cause buyers to continue to stay on the sidelines.” He said: “The persistent hawkish rhetoric makes us wonder, since the median in the dot plot suggests one more rate hike, why didn’t the dot plot in the September Summary of Economic Projections (SEP) appear even more hawkish?”