U.S. Treasury yields rose in a choppy session after Democrats won control of both chambers of Congress and investors assessed economic data. The 10-year yield gained 0.6 basis point to 4.956%, while the September trade deficit narrowed 0.7% to $105.0 billion.
Treasury yields were slightly higher after Democrats won control of the Senate and House, as investors weighed possible gridlock between Congress and President Donald Trump’s White House. The 10-year yield rose 0.6 basis point to 4.956%, the 30-year yield gained 1.1 basis points to 5.335%, and the two-year yield rose 1.7 basis points to 4.631%.
U.S. services-sector growth slowed marginally in October, while supply chains remained strained and input prices elevated. The September trade deficit narrowed 0.7% to $105.0 billion, compared with economists’ expectations for $108.0 billion. The Treasury Department also changed its language on future auction sizes, a shift analysts expect could lead to larger sales of short- and intermediate-dated debt and possible cuts to longer-dated auctions.
Some investors saw potential for congressional gridlock to limit near-term fiscal spending. Investors also cited the possibility that Democratic support for AI regulation could slow growth and reduce the need for rate hikes; one strategist linked votes for more than 30 measures restricting data center construction to moderating growth or rate-hike expectations.
