09.09.202514:24:29UTC+00US 10-Year Yield Holds Rebound

The yield on the 10-year U.S. Treasury note remained above 4.07% on Tuesday, recovering from its earlier drop to a five-month low of 4.03%. This movement reflects ongoing market anticipation regarding the Federal Reserve's approach to a cooling labor market amid persistent inflation concerns. A preliminary annual benchmark revision showed a significant downward adjustment of 911,000 nonfarm payrolls for the year ending March 2025—the largest such revision in 26 years. This adjustment adds to mounting evidence of weakening labor conditions, reinforcing the negative trends highlighted in recent jobs reports. Consequently, several members of the Federal Open Market Committee (FOMC) have suggested the possibility of resuming interest rate cuts next week. The market currently predicts the central bank will implement a rate cut at each of its three remaining meetings this year. However, with inflation expected to increase in August, policymakers may face constraints in shifting their focus away from inflation to prioritize growth concerns.