SAN FRANCISCO (Reuters) - The surge in 10-year U.S. Treasury yields on Friday after a government report showed that wages’ rising smartly is just a “delayed reaction” to stronger economic growth that has been ongoing for some time, a top policymaker said on Friday.
“Markets sometimes take a while to get going and then they move more quickly,” San Francisco Federal Reserve Bank President John Williams told reporters after a talk here.
“Some of this adjustment seems to be a realization the economy’s doing really well, and obviously with the tax cuts that’s going to add further stimulus in the next years, and if anything the inflation data are heading in the right way,” Williams said.
U.S. stocks fell for a second straight day on Friday and the Dow Jones Industrial Average had its worst day in two years. But Williams was upbeat, calling current financial conditions, even after the rise in bond yields and the fall in stocks, “incredibly positive.”
Reporting by Ann Saphir; Editing by Leslie Adler