U.S. Treasury yields remained broadly flat on Tuesday morning after reaching multi-decade highs in the previous session, as investors awaited the release of minutes from the Federal Reserve's most recent meeting [1]. The benchmark 10-year Treasury yield was last trading just below the flatline at 5.302%, following a surge to its highest level since April 2002 on Monday [1]. The 30-year Treasury bond yield edged up less than a basis point to 5.665%, also marking levels not seen since May 2002, while the 2-year Treasury note yield declined by 1 basis point to 4.818% [1].
The sharp rise in yields on Monday was attributed to fresh data from the Institute for Supply Management, which indicated cooling services growth. The PMI reading for September came in at 54.9, matching expectations but slightly below August's figure. Additionally, the price index within the service ISM increased by 1.4 points to 74 [1].
Market participants are closely monitoring the upcoming release of the FOMC minutes from the Federal Reserve's September meeting, scheduled for Wednesday. These minutes are expected to provide further insight into the Fed's future monetary policy direction [1]. According to the CME Group's FedWatch tool, traders are currently pricing in a 78% probability that the Federal Reserve will keep interest rates unchanged at its next meeting [1].
CONCLUSION
U.S. Treasury yields are holding near their highest levels in over two decades as investors await key insights from the upcoming FOMC minutes. Recent economic data and market pricing suggest expectations for steady Fed policy, but the release of the minutes remains a pivotal event for market direction.