Bond Report: 10-year Treasury yield ends at one-week low after briefly surpassing 5%

by | Oct 23, 2023 | Stock Market

The key 10-year Treasury yield finished at a one-week low after briefly breaking through 5% on Monday, as traders assessed the war in the Middle East and questions about the continued strength of the U.S. economy.What happened
The yield on the 2-year Treasury
declined 2.2 basis points to a more-than-one-week low of 5.06% from 5.082% on Friday. Yields move in the opposite direction to prices.

The yield on the 10-year Treasury
fell 8.8 basis points to 4.836% from 4.924% on Friday, after touching an intraday high of 5.022% on Monday. Monday’s level is the lowest since Oct. 16, based on 3 p.m. Eastern time figures from Dow Jones Market Data.

The yield on the 30-year Treasury
dropped 9.9 basis points to 4.988% from 5.087% on Friday.

What drove markets The 10-year yield briefly pulled back from the 5% level on Monday as investors and traders readjusted their thinking about the recent sharp rise in long-term interest rates.

Yields have climbed for months as the result of what Federal Reserve officials, including Chairman Jerome Powell, and some investors see as rising term premiums — the unobservable compensation that investors require for bearing the risk that rates may change over the long term. However, some analysts said the rise in yields may have gone a bit to far, considering the current state of the U.S. economy. Bill Gross, co-founder of fixed-income investing giant Pacific Investment Management Co., said Monday in a post on social-media platform X that the U.S. economy is likely headed for a recession by year …

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