12.09.202502:44:16UTC+00US 10-Year Yield Holds Near 5-Month Low

The yield on the 10-year US Treasury was steady at approximately 4.03% on Friday, maintaining its position near a five-month low. This stability follows inflation data that aligns with forecasts, supporting the anticipation of Federal Reserve policy easing in response to a weakening labor market. The Consumer Price Index (CPI) for August revealed a monthly increase in consumer prices of 0.4%, slightly exceeding predictions, while the annual rate remained at 2.9%, which was in line with expectations. Additionally, jobless claims increased by 27,000, reaching 263,000, marking the highest level since 2021 and indicating a softer employment scenario. As a result, markets have now priced in a roughly 93% probability of a 25 basis point interest rate cut at the Federal Reserve's meeting on September 17, with the likelihood of a more substantial half-point cut also rising. These developments come on the heels of weaker-than-expected producer price data released on Wednesday, further solidifying predictions for a rate reduction in September.