The yield on the US 10-year Treasury note remained steady around 4.52% on Wednesday, halting a recent decline as traders geared up for the Federal Reserve’s upcoming policy decision.
US 10-year yield stabilizes as Fed decision looms
The central bank is widely anticipated to keep interest rates unchanged, despite President Donald Trump’s calls for an immediate reduction in borrowing costs. Market participants are expected to pay close attention to Fed Chair Jerome Powell’s remarks and the central bank’s inflation outlook for indications on when the next rate cut might occur. Additionally, traders are awaiting the release of the PCE price index report on Friday, which is the Fed’s preferred measure of inflation.
Treasury faced earlier downward pressure
Earlier in the week, Treasury yields faced downward pressure as concerns grew over Chinese startup DeepSeek’s challenge to US dominance in artificial intelligence, triggering a wave of risk-off trades. Investors are also factoring in Trump’s escalating tariff threats, with the February 1 deadline for the first round of tariffs targeting Mexico, Canada, and China drawing closer. These geopolitical and economic developments have added to the uncertainty surrounding the market, prompting cautious trading behavior.
