Treasury Yields Fluctuate as Investors Monitor Economic Data Ahead of Fed Meeting

On Wednesday, U.S. Treasury yields increased as investors analyzed recent economic data and assessed the state of the economy. The 10-year Treasury yield rose by over two basis points to 4.6273%, while the 2-year Treasury yield was up by more than three basis points to 4.9414%. Yields and prices move in opposite directions, with each basis point representing 0.01%.

Investors continued to monitor economic data as uncertainty about the state of the economy and its potential impact on Federal Reserve monetary policy decisions persisted. Recent data, including the S&P Global Flash manufacturing PMI for the U.S. in April, which came in at a four-month low of 49.9, suggested a contraction in the sector. This led investors to believe that the economy may be experiencing some easing.

Despite concerns about elevated interest rates and persistent inflation, recent economic data has indicated resilience in the economy. Expectations for impending interest rate cuts by the Fed have shifted, raising questions about whether there will be fewer cuts than expected this year. More economic data is set to be released throughout the week, including durable goods orders, a first-quarter GDP reading, and the personal consumption expenditures price index.

The data will be closely watched ahead of the Fed’s upcoming meeting on April 30-May 1. While the central bank is widely anticipated to maintain current rates, investors will be on the lookout for any indications about the future of monetary policy