The U.S. 10-year Treasury yield was near flat Monday as investors looked ahead to key inflation data for insights into the state of the economy.
The yield on the 10-year Treasury slipped by less than 1 basis point to 4.079%. The 2-year Treasury yield rose by less than 1 basis point, sitting at 4.494%.
Yields and prices have an inverted relationship. One basis point equals 0.01%.
Fresh key inflation data is expected this week in form of the consumer price index for February on Tuesday and the producer price index on Thursday. Last month’s CPI and PPI readings came in hotter than expected, indicating persistent inflation and sparking concerns about the outlook for rate cuts.
That comes after Friday’s release of the closely watched jobs data for February. Nonfarm payrolls rose by more than expected, showing that the U.S. economy added 275,000 jobs in February, more than the Dow Jones estimate of 198,000.
The unemployment rate, however, rose to 3.9%, coming in higher than January’s 3.7% reading which economists surveyed by Dow Jones had expected to remain unchanged in February.
Investors widely took the data as a sign that interest rate cuts from the Federal Reserve are on the table for this year. But when they will take place and how many cuts there will be in 2024 remains uncertain.
Fed Chairman Jerome Powell last week indicated that there is likely not much longer to go before policymakers are convinced that rate cuts are appropriate. However, the Fed is still awaiting more evidence that the economy is easing and that inflation is moving toward the 2% target range.
