US Treasury yields hold steady ahead of fed rate decision, PCE inflation data and key US economic reports this week

US Treasury yields remained mostly steady on Monday as investors prepared for the Federal Reserve’s interest rate decision and several important economic reports due this week. Investors are watching these updates to understand the direction of US interest rates and the economy.

US Treasury yields hold steady ahead of the Federal Reserve rate decision and key inflation data.The 10-year Treasury yield edged higher to 4.99%. It rose by around 1 basis point during the session. The 30-year Treasury yield remained unchanged at 5.31%, while the 2-year Treasury yield increased by 2 basis points to around 4.7%, CNBC reported.

Other Treasury yields also showed mixed movements on Monday. According to CNBC’s market data: Investors are now focusing on the Federal Reserve’s interest rate decision on Wednesday. The central bank’s decision is the biggest event for financial markets this week, as investors look for clues about its next steps on interest rates, CNBC reported.

Markets expect the Fed to keep interest rates unchanged. Traders are pricing in a more than 90% chance that policymakers will maintain the federal funds rate target range at 3.75% to 4%, according to the CME FedWatch Tool.

The Fed could maintain a cautious stance despite holding rates steady. Deutsche Bank analysts said the central bank’s broader message is likely to remain hawkish. This means policymakers may signal that interest rates could rise further if inflation remains high, even if they decide not to change rates this week, the analysts said.

Recent inflation data could support further interest rate increases. Deutsche Bank economists believe the latest inflation figures strengthen the case for additional monetary tightening over time. The analysts said the Fed could still pause this week while keeping the possibility of future rate increases open.

The personal consumption expenditures (PCE) price index is another major focus this week. The inflation gauge, which is the Federal Reserve’s preferred measure for tracking price increases, is scheduled for release on Thursday.

Investors will examine the figures for clues about whether inflation is easing or remains a concern for policymakers, CNBC reported. Employment and manufacturing-related data will also influence market sentiment. The weekly ADP Employment Change report and durable goods orders for September are scheduled for Tuesday.

These reports will give investors more information about the US labour market and demand for long-lasting manufactured goods. Investors will receive more labour market information on Thursday and Friday. Weekly initial jobless claims are due on Thursday, followed by additional employment data on Friday.

These reports could help investors assess the strength of the US labour market and its possible impact on the Federal Reserve’s interest rate outlook, CNBC reported. Treasury yields and bond prices move in opposite directions.

When bond prices rise, their yields generally fall, and when prices decline, yields usually increase. One basis point equals 0.01 percentage points. These measures help investors track daily movements in the US government bond market.

Overall, investors are waiting for clearer signals on inflation, economic growth and interest rates. The Fed’s Wednesday decision, followed by the PCE inflation report and other economic releases, could influence expectations for future policy moves and the direction of Treasury yields, CNBC reported.

Durva More is a Senior Content Producer at Hindustan Times, where she covers finance, and global news. She brings experience across digital and television journalism, with a strong focus on breaking news, business reporting, and international affairs.

Before joining Hindustan Times, Durva worked as an International News Writer at The Economic Times, covering a diverse range of subjects including global politics, business, sports, entertainment, and major world events.

She also worked as a Business Reporter with NDTV Profit. A postgraduate diploma holder in Journalism from the Asian College of Journalism, Durva is passionate about field reporting and storytelling. She thrives on the adrenaline of chasing stories, speaking with people from different walks of life, and amplifying voices that deserve to be heard.

Her reporting is driven by curiosity, accuracy, and a commitment to making complex subjects accessible to readers. When she is not chasing stories or covering breaking news, Durva enjoys reading books and painting. She loves exploring new ideas, meeting people, and learning about different perspectives.

For her, both journalism and art are ways to understand the world and tell stories that matter.Read More