Treasury yields dipped on Wednesday as investors grew more fearful of a coronavirus resurgence.
An acceleration of Covid-19 cases sparked angst among investors about the economy and recent reopening efforts. Florida confirmed its Covid-19 cases jumped by 5,508 on Tuesday, a new record. Meanwhile, New York Gov. Andrew Cuomo said travelers from states with high coronavirus infection rates that are coming to New York, Connecticut and New Jersey must quarantine for 14 days.
The fears triggered a big sell-off in the stock market, with the S&P 500 dropping 2.6%.
White House health advisor Dr. Anthony Fauci warned Tuesday that certain areas in the country are facing a "disturbing surge" of Covid-19 cases.
The International Monetary Fund projected that the contraction in the global economy will be worse than previously feared, shrinking 4.9% in 2020. Previous projections called for a 3% decline. The Fund also lowered growth projections in 2021, saying the global economy will expand 5.4%, down from 5.8%.
Bond traders are also likely to monitor speeches from Chicago Fed President Charles Evans and St. Louis Fed President James Bullard.
Auctions will be held Wednesday for $20 billion of 2-year floating-rate notes and $47 billion of 5-year notes.