Benchmark Treasury Yields Fall as Fed Rate Decision Looms

Benchmark Treasury yields headed down Friday as the Federal Open Market Committee is scheduled to meet next week to decide on what will most likely be another interest rate hike in 2018–possibly the third of the year.

The benchmark 10-year yield went down to 3.07 and the 30-year yield headed lower to 3.206. In the meantime, short-term yields showed the 2-year ticked higher to 2.813 and the 5-year to 2.955 as of 2:30 p.m. ET.

The Fed has already pushed the federal funds rate to 2 and another 25 basis points would leave it at 2.25–the same level where it was 10 years ago.

“The message from this meeting will be continued gradual hikes, with a watchful eye toward risks — to both the upside and downside,” Morgan Stanley economists said in a note.


The general consensus based on the latest Fedspeak is that the central bank will continue forward with an upward, but steady rate hike. Based on the latest round of economic data, he economy has been full steam ahead highlighted by a strong stock market that has seen the major indexes like the S&P 500 reach record levels.

Steady diet of rising rates is in order

With no signs of slowing, it appears that a steady diet of rising rates is in order, according to Boston Federal Reserve President Eric Rosengren.