10.12.202519:11:52UTC+00US 10-Year Yield Retreats as Fed Cuts Rates

The yield on the US 10-year Treasury dipped to 4.16%, retreating from its earlier near three-month high. Simultaneously, the yield on the two-year notes, which are closely aligned with Federal Reserve policy, fell by approximately 5 basis points to 3.56%. This occurred following the Federal Reserve's anticipated 25-basis-point rate reduction. Notably, the Fed's latest statement included a subtle modification, indicating that policymakers might delay further interest rate cuts in January as they await additional data to further assess the economic situation. In revised projections, the Fed outlined an optimistic growth perspective, upgrading their 2025 median GDP forecast to 2.3%, up from 1.8% in September. Growth expectations for 2027 were slightly increased to 2% from 1.9%. Concurrently, the central bank adjusted its inflation outlook downward, reducing the 2025 projection to 2.5% from 2.6% and the 2026 forecast to 2.4% from 2.6%, although these figures remain above the 2% target.