Financial ETFs rise as yield curve steepens after Fed announcement

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Financial ETFs rise as yield curve steepens after Fed announcement
Financial-sector exchange-traded funds jumped Thursday midday after the Federal Reserve announced it would allow inflation to run hot in order to achieve an average inflation target of 2%. That means monetary policy, like interest rates, will stay easier than in the past. Bond yields jumped as investors sold, with the 10-year Treasury note up 5 basis points to 0.748%. The yield curve – the difference between yields on longer- and shorter- dated bonds – widened. Both conditions make it easier for banks and other financial institutions to make money. The Financial Select Sector SPDR Fund and the Vanguard Financials ETF were both up 1.7%, while the Invesco KBW Bank ETF rose 2.1%.
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