Investors Evaluate Economic Prospects as U.S. Treasury Yields Fluctuate

On Monday, U.S. Treasury yields saw a slight increase as investors weighed the economic outlook and the possibility of an end to the Federal Reserve’s interest-rate hiking cycle. The 10-year Treasury yield rose by less than one basis point to 4.9151%, up from the 4.379% low it briefly touched on Friday. Meanwhile, at 3:31 a.m. ET, the yield for the 2-year Treasury was over three basis points higher at 4.4764%, up from its previous low of 4.379%.

Investors have been considering various factors such as the economic outlook and monetary policy of the Federal Reserve, with hopes growing that the central bank is done hiking rates. Last week, both the producer and consumer price index came in lower than expected, indicating that inflation is easing and that the Fed’s interest rate hikes are having their desired effect of cooling down the economy. With December being when the Fed is set to meet next, expectations are for interest rates to remain unchanged. Investors are also pondering when the Fed will begin cutting rates, something that Fed officials have not addressed in detail yet. However, many are hoping this may change based on recent economic data.

This month, investors can expect to receive more insight into how much more consideration and expectations for interest rates will be discussed by looking forward to the release of minutes from the last meeting held by Fed officials on Wednesday morning at 8:30 a.m., EST (Eastern Standard Time). Bond markets will be shortened this week as they will remain closed on Thursday for Thanksgiving Day and close early on Friday in anticipation of holiday trading activity kicking off after Thanksgiving weekend ends

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