FX.co ★ US 10-Year Yield Stabilizes as Fed Outlook Mulled

On Friday, the 10-year US Treasury note yield stabilized around 4.25%, rebounding from a temporary drop in the previous session. Investors were evaluating comments from Federal Reserve Chair Jerome Powell, who stressed that the central bank is not in a hurry to cut interest rates further, following its recent dovish pause. Earlier, on Wednesday, the Federal Reserve had decided to keep rates steady but hinted at the possibility of two rate reductions later this year. The central bank also pointed out increasing risks to economic growth, employment, and inflation in its latest forecasts. Powell sought to alleviate worries about the inflationary impact of President Donald Trump’s tariffs, describing them as "transitory." Additionally, the Federal Reserve revealed plans to slow down its balance sheet reduction by reducing its monthly Treasury holdings decrease to $5 billion from $20 billion, while continuing the $35 billion monthly runoff for mortgage-backed securities (MBSs).