Treasury yields move lower as attention turns to Fed meeting
Treasury yields fell on Wednesday as investors awaited the Fed’s next policy decision on interest rates later in the session.
The benchmark 10-year Treasury yield fell nearly 2 basis points to 4.175%. The yield on the 30-year Treasury note fell more than 2 basis points to 4.824%. The 2-year Treasury note yield fell more than 1 basis point to 3.659%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
Markets expect the central bank to keep interest rates unchanged in the range of 3.5% to 3.75%. Investors will be waiting for guidance from Fed Chairman Jerome Powell on whether oil prices will affect future monetary policy.
“We’ll be lucky to get even one rate cut this year, and if it does happen, it’ll probably be towards the end of the year when we’ll have a new Fed Chair and more data to evaluate on the inflation and employment front,” said Rick Gardner, chief investment officer at RGA Investments.
Along with the decision on benchmark lending rates, the Fed will release its latest forecasts for economic growth, inflation and interest rates for the coming years, known as the Summary of Economic Projections.
Investors will be looking at the latest guidance on the scope and size of potential rate cuts later in the year.
Meanwhile, oil prices fell on Wednesday as U.S. crude stocks helped offset rising geopolitical risk premiums despite escalating attacks on the United Arab Emirates’ energy infrastructure.
The prices of the international benchmark Brent dropped by 1.5 percent to $101.90 per barrel. U.S. oil prices fell 2.9% to $93.40 per barrel as of 3:44 a.m. ET.
— Pia Singh and Lee Ying Shan also contributed to this report
