Treasury yields ease slightly ahead of key inflation data

U.S. Treasury yields dropped on Friday as investors reviewed the GDP report and awaited key inflation figures. The 10-year Treasury yield decreased by over three basis points to 4.6754%, while the 2-year Treasury yield was down by more than one basis point at 4.9850%. Yields and prices move inversely, with one basis point equivalent to 0.01%. On Thursday, the 10-year Treasury and 2-year Treasury yields reached their highest levels since November after a disappointing GDP reading. The first-quarter GDP growth of 1.6% fell short of economists’ expectation of 2.4% and raised concerns about inflation and Fed policies. The personal consumption expenditures price index, an important inflation gauge, will be released on Friday. Economists expect increases in both headline PCE and core-PCE. The Federal Reserve’s upcoming policy meeting has also spurred uncertainty regarding interest rates. Expectations for rate cuts have been pushed back, leading to speculation about future actions by policymakers.