Treasury yields fall as investors await key inflation data – NBC4 Washington

U.S. Treasury yields fell slightly on Tuesday as investors waited for new inflation data and watched comments from Federal Reserve policymakers.

At 4:45 a.m. Dutch time, the yield on the 10-year government bond fell by less than one basis point to 4.4747%. The yield on two-year government bonds last stood at 4.8400%, after falling by more than one basis point.

Revenues and prices have an inverse relationship. One basis point corresponds to 0.01%.

Investors watched new key economic data and comments from Federal Reserve officials, scanning them for hints about the future path for monetary policy.

The April producer price index, which tracks inflation at the wholesale level, will be released on Tuesday. Economists polled by Dow Jones expect the PPI to have risen 0.3% from the previous month.

This is the first of two major inflation reports scheduled for this week, with the Consumer Price Index for April due Wednesday. According to a Dow Jones survey, economists expect this to reflect a 3.4% increase from a year ago and a 0.4% increase month-over-month.

That comes after the Fed said at its last meeting that there was “a lack of further progress” on returning inflation to the 2% target. Policymakers have also repeatedly said they are looking for data for evidence that inflationary pressures are cooling before they feel ready to cut rates.

The data could therefore influence investor expectations about when rates could be cut and how many cuts could happen this year. Should the CPI and PPI indicate that inflation is cooling, expectations for rate cuts may increase, and vice versa.

More Fed officials, including Chairman Jerome Powell, will also speak this week and may provide new insights on the outlook for monetary policy.