U.S. Treasury yields were little changed on Friday as investors considered what could be ahead for the economy and weighed the outlook for interest rates after this week’s Federal Reserve policy meeting.
At 4:13 a.m. ET, the yield on the 10-year Treasury was down by less than one basis points to 4.4783%. The 2-year Treasury was trading at 5.1356% after dipping by just over one basis point. Both eased slightly from the fresh multi-year highs they hit on Thursday, when they reached levels last seen in 2007 and 2006, respectively.
Yields and prices move in opposite directions and one basis point equals 0.01%.
Treasurys
| TICKER | COMPANY | YIELD | CHANGE | %CHANGE |
|---|---|---|---|---|
| US1M | U.S. 1 Month Treasury | 5.398% | +0.007 | 0.00% |
| US3M | U.S. 3 Month Treasury | 5.516% | +0.032 | 0.00% |
| US6M | U.S. 6 Month Treasury | 5.584% | +0.045 | 0.00% |
| US1Y | U.S. 1 Year Treasury | 5.472% | +0.007 | 0.00% |
| US2Y | U.S. 2 Year Treasury | 5.138% | -0.01 | 0.00% |
| US10Y | U.S. 10 Year Treasury | 4.476% | -0.004 | 0.00% |
| US30Y | U.S. 30 Year Treasury | 4.559% | +0.007 | 0.00% |
Thursday’s initial weekly jobless claims came in lower than expected at 201,000, which some traders understood as a sign that further interest rate hikes may be needed to cool the economy, including the labor market.
That comes after the Fed’s latest policy meeting, which concluded Wednesday. The central bank said it would keep interest rates unchanged for now, but added that another rate hike is likely to come this year. The Fed also suggested that rates will stay higher for longer as it reduced the number of rate cuts it expects to make next year to two.
Fed Chairman Jerome Powell indicated that inflationary pressures continue to concern policymakers, and while there are signs that inflation is easing, more progress is needed.
Meanwhile, fears about a government shutdown emerged on Thursday after House Republican leaders sent the chamber into recess. That prompted concerns that lawmakers will not pass a bill needed to fund the government.
Such a shutdown could not only undermine confidence in the ability of the U.S. government to remain operational, but also reduce the gross domestic product in the fourth quarter. The Fed’s monetary policy may also be affected as a shutdown could limit what economic data is available to the central bank.
