FX.co ★ US 10-Year Treasury Yield Rises Ahead of Powell Speech

The yield on the 10-year U.S. Treasury reached 4.33% on Friday, as investors awaited Federal Reserve Chair Jerome Powell's much-anticipated address at Jackson Hole. The financial community is particularly attentive to whether Powell will hint at forthcoming interest rate reductions. Current market conditions suggest a 65% probability of a rate cut in September, alongside approximately 50 basis points of easing anticipated in 2025. Despite hawkish remarks from other Federal Reserve officials and mixed economic indicators prompting a decline in interest-rate swaps, uncertainty persists regarding the timing and magnitude of any rate cuts. Powell is likely to underscore that a September decision will be contingent upon forthcoming employment and inflation data, thereby preserving flexibility and policy autonomy. Investors anticipate that Powell will acknowledge signs of economic weakness but refrain from any definitive commitment to immediate rate reductions.