FX.co ★ US 10-Year Yield Holds Up Ahead of Powell Speech

The yield on the 10-year US Treasury note remained above 4.32% on Friday, maintaining its recent upward trend as investors anticipated Federal Reserve Chair Jerome Powell's speech at Jackson Hole for new insights into the monetary policy direction. Market participants are seeking clarity on interest rate movements amid worries that Powell might counter expectations for a near-term easing. Currently, futures indicate about a 75% likelihood of a 25 basis point reduction in rates in September, a decrease from over 90% just one week ago. Policymakers have highlighted that tariff-related costs continue to present inflationary risks, even though signs of weakness in the labor market are minimal. Kansas City Fed President Jeffrey Schmid stated that a "modestly restrictive" monetary policy remains suitable given inflation risks, whereas Cleveland Fed President Beth Hammack expressed her opposition to rate cuts at this point in time.