Traders work on the floor of the New York Stock Exchange (NYSE) on October 22, 2024 in New York City.
The 10-year Treasury yield fell for a second day Friday, set to finish the week lower even after a big pop triggered by Donald Trump's presidential win.
The benchmark 10-year rate dipped 4 basis points to 4.29% after falling about 11 basis points in the previous session. The yields is now lower than last Friday's level of 4.37%. The 2-year Treasury yield traded 4 basis points higher at 4.24%.
Yields and prices have an inverted relationship and one basis point is equivalent to 0.01%.
Bond yields got a boost Wednesday with the 10-year yield popping 15 basis points after Trump defeated Vice President Kamala Harris as traders believe his pro-business policies including tax cuts could spark economic growth.
"The Treasury market continues to stabilize as the 'Trump trade' momentum recedes," Ian Lyngen, BMO's head of U.S. rates, said in a note. "In keeping with the time-tested approach of 'sell the rumor, and buy the fact', 10-year yields have drifted back into the 4.20-4.30% range that was in place at the beginning of the week."
Investors also digested the Federal Reserve's widely anticipated move to cut interest rates by a quarter point to a target range of 4.50% to 4.75%.
Looking ahead, Powell said policymakers would make their decisions on a meeting by meeting basis, and that there was no "preset course" for monetary policy. Powell also noted that he was "feeling good" about the economy overall.
Money Report
One Fed meeting remains on the agenda for this year on Dec. 17-18, for which traders were last pricing in an around 75% chance of another rate cut, CME Group's FedWatch Tool showed.
On the data front, the University of Michigan's consumer sentiment gauge came in at 73 in November, rising to the highest level since April. The reading was also better than the consensus expectation of 71 and up from 70.5 in October.
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