FX.co ★ US Treasury Yields Fall on Tuesday

The yield on the US 10-year Treasury note fell nearly 5 basis points to 5.09% on Tuesday, hovering near its lowest level in a month, after weaker housing data and as investors continued to weigh persistent inflationary pressures ahead of next week’s Federal Reserve interest rate decision. Housing starts declined 5.2% in September, while pending home sales dropped to a record low, underscoring the ongoing impact of elevated mortgage rates on housing demand. The Fed is widely expected to keep rates unchanged next week, while markets are pricing in a 25 bps increase in December. Meanwhile, the 2-year Treasury yield, which is especially sensitive to near-term monetary policy expectations, edged down to 4.76%. The 30-year Treasury yield, more attuned to long-term inflation prospects and geopolitical risks, also fell, to 5.42%.