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10-year Treasury extends multiyear high ahead of Fed Chair Powell speech


U.S. Treasury yields rose on Thursday, with the 10-year Treasury extending its latest multiyear high as investors awaited remarks from Federal Reserve Chairman Jerome Powell.

At 4:15 a.m. ET, the yield on the 10-year Treasury was up by over six basis points to 4.9663%. It had risen as high as 4.971% earlier in the session, trading at levels last seen in 2007 after first crossing the 4.9% mark on Wednesday.

The 2-year Treasury yield was last more than two basis points higher at 5.2420%, hovering at levels last seen in 2006, while the 5-year Treasury yield hit 4.9720% after rising by over four basis points. It last traded at similar levels in 2007.

Yields and prices have an inverted relationship and one basis point equals 0.01%.

Treasurys

TICKER COMPANY YIELD CHANGE
US1M U.S. 1 Month Treasury 5.418% +0.014
US3M U.S. 3 Month Treasury 5.516% +0.018
US6M U.S. 6 Month Treasury 5.603% +0.023
US1Y U.S. 1 Year Treasury 5.493% +0.022
US2Y U.S. 2 Year Treasury 5.251% +0.033
US10Y U.S. 10 Year Treasury 4.968% +0.066
US30Y U.S. 30 Year Treasury 5.058% +0.064

Investors looked to a speech from Fed Chairman Powell as they considered the outlook for interest rates and the economy.

Powell is expected to echo comments from other Fed officials who have indicated that rates will likely remain elevated for longer than previously expected. Investors are also hoping for clues about whether the central bank will hike rates again, a question over which uncertainty has arisen in recent weeks.

That comes as multiple central bank speakers have suggested that rates may not need to be hiked further and keeping them at their current level would be sufficient to achieve the Fed’s goals of easing inflation and cooling the economy.  Some policymakers have cited tighter financial conditions brought on by surging Treasury yields as a contributing factor.

Fed Governor Christopher Waller said on Wednesday that the central bank was in a position to “wait, watch and see how the economy evolves” before making decisions about interest rates. Waller added that he is considering various data points to assess whether the Fed’s monetary policy moves so far are having the desired impact.

Some recent economic data sparked concerns that rates may go higher still among investors.

Fresh economic data will be released Thursday, when weekly initial jobless claims and September’s existing home sales figures are due.



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