10-Year Treasury Yield Declines as Fed Reiterates Forecast for Rate Cuts

On Wednesday, the 10-year U.S. Treasury experienced a decline as investors analyzed the Federal Reserve’s recent interest rate determination and its strategy to implement three easing measures by year-end.

The 10-year Treasury yield decreased by almost 2 basis points to reach 4.281%, while the 2-year Treasury yield saw a more significant drop of over 7 basis points, settling at 4.617%.

10-Year Treasury Yield Declines as Fed Reiterates Forecast for Rate Cuts
The 10-year Treasury yield decreased by almost 2 basis points to reach 4.281%.

It’s important to note that yields and prices exhibit an inverse relationship, and each basis point change is equivalent to 0.01%.

On Wednesday afternoon, the central bank opted to maintain benchmark interest rates at their current levels and upheld the earlier projection for three reductions in 2024.

10-Year Treasury Yield Declines as Fed Reiterates Forecast for Rate Cuts
The market reacts rates stable, investor scrutiny intensifies over Fed’s inflation confidence threshold.

Nonetheless, policymakers emphasized that these cuts won’t materialize until the Fed is more assured that inflation is receding towards its 2% objective.

“We might be edging closer to the inaugural interest rate cut, but the sentiment doesn’t quite align,” remarked Greg McBride, chief financial analyst at Bankrate. “Interest rates surged upward rapidly, but the descent will likely be more gradual.”

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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