Treasury yields in focus as investors assess recession risk

Treasury yields in focus as investors assess recession risk

The yield on the benchmark 10-year U.S. Treasury fell to its lowest level in nearly two weeks on Thursday as investors continued to assess the likelihood of a recession.

The yield on the 10-year Treasury was about 4 basis points lower at 3.117%, while the yield on the 30-year Treasury fell 3 basis points to trade at 3.21%. Earlier in the session, the 10-year fell below the 3.1% mark. Yields move inversely to prices.

The moves come after Federal Reserve Chairman Jerome Powell told Congress that the U.S. central bank was “strongly committed” to curbing the spike in the rate of inflation. Market participants are increasingly concerned that aggressive monetary tightening could tip the world’s largest economy into recession.

“At the Fed, we understand the difficulties caused by high inflation,” Powell told the Senate Banking Committee on Wednesday. “We are firmly committed to bringing inflation down, and we are moving quickly to do so.”

Last week the Fed raised its key rate by 75 basis points, its biggest increase since 1994, but it is believed that aggressive tightening could mean further downward pressure on growth.

On the data front, the first jobless claims for the week ending June 18 will be released along with first-quarter current account numbers at 8:30 a.m. ET Thursday.

The S&P Global Flash Manufacturing Purchasing Managers Index for June, the S&P Global Flash Services PMI for June and the Kansas City Fed Manufacturing Survey Composite Index for June will all follow. later in the session.

– CNBC’s Sarah Min & Elliot Smith contributed to this report.

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