On a Thursday morning, the U.S. Treasury yields exhibited minor changes as investors processed the latest consumer inflation figures and pondered the future course of interest rates.
Following a significant surge on Wednesday, the 10-year Treasury yield slightly increased by one basis point, reaching 4.552%, while the 2-year Treasury yield increased marginally to 4.961%.
This adjustment came after the March Consumer Price Index (CPI) report, which indicated a stronger-than-expected persistence of inflationary pressures.
Investors' reactions were notably cautious, as the higher inflation rates dampened hopes for an imminent interest rate cut by the Federal Reserve, previously anticipated by many for June. Market sentiment, as reflected by the CME Group's FedWatch tool, showed a significantly reduced expectation of a rate cut, with the probability now standing at just 17% based on CNBC.
Adding to the week's data deluge, Thursday also awaits the release of the producer price index (PPI) for March, offering further insights into inflation at the wholesale level.
