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Treasury yields are little changed as investors prepare for Fed meeting

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U.S. Treasury yields were little changed on Monday, ahead of the Federal Reserve's meeting this week to discuss its monetary policy plans and announce its latest interest rate decision.

The yield on the 10-year Treasury was down by 1 basis point to 3.827%. The 2-year Treasury yield was about flat at 4.85%.

Yields and prices move in opposite directions. One basis point equals 0.01%.

Federal Reserve policymakers will meet on Tuesday and Wednesday and are expected to announce another interest rate increase at the conclusion of their meeting.

Guidance issued alongside the rate decision and comments from Fed Chairman Jerome Powell in the post-meeting press conference will also be key for investors. They will likely provide clues about what is next for monetary policy and how the Fed views the state of the economy, including the outlook for inflation.

The Fed started taking a restrictive approach to monetary policy in early 2022 with the aim of easing inflation and cooling the economy. The latest consumer price index, published earlier this month, indicated that the central bank's policy moves are producing the desired effect.

But at 3%, inflation remained above the Fed's target range of 2% on an annual basis. Core inflation, which policymakers tend to look at more closely, was even higher, at 4.8%.

Several key data points are also due this week, including the personal consumption expenditures index on Friday, which is the Fed's favored inflation gauge. The Commerce Department also will release its advance estimate on gross domestic product or the second quarter. Economists surveyed by Dow Jones expect that the U.S. grew ta a 1.7% annualized rate for the April-through-June period.

Elsewhere, the European Central Bank is due to announce an interest rate decision on Thursday and the Bank of Japan will meet at the end of the week.

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