10-year Treasury yields dip as stronger GDP data clouds rate path

U.S. Treasury yields fell slightly on Wednesday as investors positioned for a shortened trading day ahead of the holiday.

10 year Treasury The yield, a gauge of U.S. government debt, was down 1 basis point at 4.159% as of 4:15 a.m. ET.

Yield 2 year Treasury The rating remained largely unchanged at 3.528%. 30 year bond Meanwhile, the yield showed little movement, holding steady at 4.824%.

One basis point is equal to 0.01%, or 1/100 of 1%, and yields and prices move in opposite directions.

The stronger-than-expected figure potentially complicates the Federal Reserve’s path on interest rates as investors digest delayed Commerce Department data showing the U.S. economy grew 4.3% in the third quarter, the fastest growth in two years.

National Economic Council Director Kevin Hassett, a leading candidate to replace Jerome Powell as Fed chairman next year, told CNBC that the Fed is “far behind the curve” on rate cuts compared to other countries’ central banks and is not cutting interest rates fast enough.

His comments contrast with those of Cleveland Fed President Beth Hammack, who said last weekend that rates should be kept at current levels for several months because she believes inflation concerns still outweigh labor market weakness.

according to CME FedWatch ToolThe majority of investors now expect interest rates to remain steady until April, at which point the Fed will continue to cut.

Bond markets will close early at 2pm on Wednesday and will be closed on Thursday for Christmas Day.