U.S. Treasury yields fell on Friday as investors awaited a series of remarks from Federal Reserve speakers that could provide fresh hints about the central bank’s interest rate policy plans.
At 4:30 a.m. ET, the yield on the benchmark 10-year Treasury was trading at 4.0086% after falling by over six basis points. The 2-year Treasury yield was last down by more than four basis points to 4.8606%. During Thursday’s trading session it had climbed to levels last seen in 2007.
Yields and prices move in opposite directions. One basis point is equivalent to 0.01%.
A slew of Fed speakers is expected to speak on Friday, and investors will be scanning their comments for insights into whether the central bank will pursue tighter monetary policy for longer.
Throughout the week, several Fed officials indicated that interest rates could go higher still and uncertainty about whether the central bank could increase the pace of rate hikes again has spread. At its latest meeting, the Fed implemented a 25 basis point rate increase, a slowdown from previous hikes.
On Wednesday, Minneapolis Fed President Neel Kashkari said he would consider a 50 basis point rate hike, while Atlanta Fed President Raphael Bostic on Thursday advocated for continued 25 basis point increases.
Many investors had been hoping for the central bank to pause rate hikes this year as they fear elevated rates could cause the U.S. economy to contract.
On the data front, ISM’s non-manufacturing index report for February is due Friday. It reflects whether economic activity in a range of services sectors is expanding or contracting.
