On Wednesday, U.S. Treasury yields declined, stabilizing after facing heavy selling pressure on the previous trading day. Previously, investors were concerned about inflation, government debt, and the potential for further tightening of monetary policy.
The yield on 30-year U.S. Treasury bonds recently fell by 4 basis points to 5.553%. Earlier on Wednesday, this yield had reached its highest level since 2002. The yield on 10-year U.S. Treasury bonds fell by 3 basis points to 5.221%; the yield on 2-year U.S. Treasury bonds fell by 1 basis point to 4.876%.
One basis point is equal to 0.01 percentage points, and the yield rate moves in the opposite direction to the bond price trend.
Recently, yields have come under pressure, reflecting the market's expectations regarding the Federal Reserve's future interest rate decisions. Inflation expectations have risen due to the impact of high oil prices driven by conflicts in the Middle East.
According to CME Group FedWatch tools, traders currently estimate that the probability of the Federal Reserve raising interest rates again at its next meeting in October is 45%.
New York Fed Chair John Williams said later on Tuesday that "there is no need to rush into action before the Fed's October meeting; we have time to gather more information."
Investors will also be awaiting on Wednesday the inflation indicator favored by the Federal Reserve – the Personal Consumption Expenditures Price Index ( PCE ). Economists surveyed by Dow Jones expect the index to rise 0.3% month-on-month and 3.7% year-on-year.
