Treasury yields before the Fed meeting sit lower than they did at the start of the month. The 10-year Treasury yield was 4.99% on October 27 and the 2-year yield was 4.70%, according to the Treasury Department’s daily par yield curve data. For the always-current figure and its history, see our 10-year Treasury yield page.
What the Treasury data shows for October
The 10-year yield opened the month at 5.24% on October 1 and peaked at 5.31% on October 5, based on Treasury’s table. It then drifted lower, reaching 5.10% on October 15 and 4.96% on October 22, the lowest reading of the month so far. It has hovered just below 5% since: 5.00% on October 23 and 26, then 4.99% on October 27.
The 2-year yield moved in a narrower range, from 4.78% on October 1 to 4.70% on October 27, with its low of the month at 4.65% on October 22. The gap between the two, 29 basis points on October 27 by our arithmetic from Treasury’s figures, is the 10-year minus the 2-year. A positive gap means longer-term yields are above shorter-term ones.
Why Treasury yields before the Fed meeting matter
The Federal Reserve is scheduled to announce its decision this afternoon. The 2-year yield tends to reflect expectations for the Fed’s policy rate, while the 10-year yield feeds into borrowing costs such as mortgage pricing. That link is why a one-day move in the 10-year yield can show up in lenders’ quotes. Our report on how hot inflation put a second hike in play explains the backdrop, and the preview of Thursday’s GDP and PCE data covers what comes next.
The data above are Treasury’s end-of-day par yield curve rates, not live market quotes, so figures on trading screens during the day will differ. This article does not predict the Fed’s decision or where yields go next.
Editor’s take
Watch the 2-year, not just the 10-year. The 10-year has eased by about 25 basis points since the October 5 peak, but the 2-year has barely moved, which suggests traders have not changed their view of the Fed’s near-term path much. After the decision, the question is whether the 2-year reacts. If it does, the 10-year will probably follow.
For the page that tracks it over time, see the 10-year Treasury yield page. This article is general information, not financial advice.
