Treasury yields fell on Wednesday as investors awaited the Federal Reserve’s next policy decision on interest rates, later in the session.
The benchmark 10-year Treasury yield was down nearly 2 basis points at 4.175%. The 30-year Treasury bond yield fell more than 2 basis points to 4.824%. The 2-year Treasury note yield was down 1 basis point to 3.659%.
One basis point equals 0.01% and yields and prices move in opposite directions.
Markets are expecting the central bank to keep interest rates unchanged between 3.5% to 3.75%. Traders are watching for any guidance from Fed Chair Jerome Powell on whether oil prices could affect future monetary policy.
“We’ll be lucky to get a rate cut this year, and if it does come, it will be toward the end of the year when there’s a new Fed chair and more data to evaluate on the inflation and jobs front,” said Rick Gardner, chief investment officer at RGA Investments.
Along with the decision on benchmark lending rates, the Fed publishes its latest forecasts on economic growth, inflation and interest rates for the coming years, known as the Summary of Economic Projections.
Traders will look to the latest guidance on the scope and size of any potential rate cuts later in the year.
Meanwhile, oil prices fell on Wednesday despite mounting attacks on the United Arab Emirates’ energy infrastructure, as rising US crude inventories helped offset growing geopolitical risk premiums.
Brent, the international benchmark, fell 1.5% to $101.90 a barrel. US oil prices were down 2.9% at $93.40 a barrel as of 3:44 am ET.
— Pia Singh and Lee Ying Shan also contributed to this report
