Bond Prices Tank On Fed’s “No Change” Statement. Price Chart Analysis.

Bond prices dropped Thursday morning after Wednesday’s Fed statement that no change would be made in interest rate policy, leaving open the chance of rate increases later this year and early next year. The expectation that interest rates would be headed higher is leading to the selling of Treasuries.

This is the upshot of the battle to tame the upward trend of consumer prices: Fed officials say the goal is to reduce its stickiness by targeting a 2% inflation rate. To accomplish this, those in charge of central bank policy believe it’s necessary to maintain higher-than-usual interest rates and for longer periods.