Short-term Treasury yields fell after the Federal Reserve held rates steady, with the two-year yield down 5.4 basis points to 4.680%. Traders priced in a 78% chance of a December rate hike, down in conviction after Fed Chair Kevin Warsh spoke.
Shorter-dated Treasuries rose after the Federal Reserve held rates steady, as traders reassessed the outlook for rate hikes. The two-year yield fell 5.4 basis points to 4.680% in Asian trading, after reaching 4.788% on Wednesday.
The Fed said inflation remained elevated and upgraded its assessment of the economy to “strong” from “solid.” Warsh said inflation could return to the 2% target without slowing growth or raising unemployment. Markets priced in a 78% chance of a December rate hike, according to the CME FedWatch tool.
The 10-year yield was down 4.8 basis points at 4.996%, while the 30-year yield fell 3.8 basis points to 5.322%. The Fed also said it would set aside one regularly scheduled meeting in 2027 and two in 2028 to discuss major issues, not monetary policy changes.
