FX.co ★ US Treasury Yields Inch Higher after Fed

The yield on the 10-year U.S. Treasury note inched past the 4% mark on Wednesday following the Federal Reserve's anticipated 25 basis points interest rate cut and its announcement to conclude quantitative tightening. Yields across various maturities edged up as contrasting dissenting opinions highlighted a Federal Open Market Committee (FOMC) faced with differing perspectives. Notably, Kansas City Fed's Schmid favored maintaining current rates, while Governor Miran, unsurprisingly, supported a 50 basis points reduction. Additionally, the Fed plans to halt its balance sheet runoff starting in December, opting to reinvest its mortgage-backed securities assets into Treasury bills. This move seeks to alleviate the recent pressures observed in the overnight funding markets. Furthermore, rate futures continue to predict three more rate cuts by July of the following year.