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U.S. 10-year Treasury yields were little changed on Thursday as investors looked ahead to a key inflation report due on Friday.
The yield on the 10-year US Treasury note fell slightly to 3.839%, while the yield on the 2-year US Treasury note rose less than a basis point to 3.873%.
Yields and prices move in opposite directions. One basis point equals 0.01%.
This comes as market participants await a fresh batch of economic data, with focus shifting to the US Federal Reserve's preferred inflation gauge on Friday.
The latest U.S. initial jobless claims and second-quarter gross domestic product data are due out at around 8:30 a.m. ET on Thursday, followed by July’s pending home sales figures a little later in the session.
The U.S. personal consumption expenditures data will be released on the last trading day of August. The reading could provide further clues about the outlook for interest rates. Federal Reserve officials use the PCE measure as a key baseline for measuring inflation.
Federal Reserve Chairman Jerome Powell said late last week that “it’s time to adjust policy,” boosting expectations of a rate cut at the central bank’s next meeting. However, Powell declined to provide specific indications on the timing or extent of the cut.
Market participants are pricing in a rate cut at the Federal Reserve’s Sept. 18 meeting. Traders are currently pricing in a 65.5% chance of a 25 basis point rate cut next month, with a 34.5% chance of a 50 basis point rate cut, according to data from the U.S. central bank. CME Group FedWatch Tool.
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