U.S. 10-year Treasury yields rose again on Wednesday as traders digested the latest comments from Federal Reserve officials on a rate-cutting trajectory.
The 10-year Treasury yield rose more than 2 basis points to 4.206% on Tuesday, after rising 12 basis points on Monday, reaching that level for the first time in three months.
As of 4 a.m. ET on Wednesday, the 10-year U.S. Treasury yield was 4.227%, up an additional 2 basis points.
Meanwhile, the yield on two-year government bonds rose 1 basis point to 4.050%. Yields and prices move in opposite directions. 1 basis point equals 0.01%.
U.S. stock futures fell overnight as rising U.S. Treasury yields weighed on stocks, but the decline came after the S&P 500 posted its first consecutive losses since early September.
Strong economic data and concerns about the budget deficit are among the factors driving the rise in 10-year Treasury yields, even though the Federal Reserve cut interest rates by half a percentage point in September.
The Fed had expected another half-point rate cut by the end of the year, but traders became concerned that the central bank was reluctant to cut rates.
It’s been a busy week for Fed commentators, with a number of policymakers speaking earlier this week.
Investors will be excited Wednesday as Fed President Michelle Bowman speaks at the 8th Annual FinTech Conference in Philadelphia and Richmond Fed President Thomas Barkin speaks at the Virginia Education and Workforce Conference. We will keep an eye on the latest comments from Fed officials.
A beige book reviewing economic conditions across the Fed’s 12 districts is also scheduled to be released on Wednesday.
