10-year Treasury yield falls to near one-month low as recession fears intensify

US News

U.S. Treasury yields were mixed on Friday as investors continued to assess the risk of an economic downturn.

The yield on the benchmark 10-year Treasury note was trading marginally lower at 2.972%, paring losses after falling to 2.941% earlier in the session — its lowest level since June 6. Meanwhile, the yield on the 30-year Treasury bond rose 3 basis points to 3.158%.

The 2-year Treasury rate, which is typically more sensitive to U.S. monetary policy changes, was down around 2 basis points at 2.912%. The 2-year note reversed some of its losses after falling to a one-week low of 2.895%. Yields move inversely to prices.

Treasurys

The S&P 500 on Thursday closed out its worst first half in decades. The broader market index dropped 20.6% for its largest first-half decline since 1970.

The steep first-half losses come at a time when market participants are grappling with soaring inflation and tighter monetary policy.

The core personal consumption expenditures price index, the Fed’s preferred inflation measure, rose 4.7% in May, the Commerce Department reported Thursday. That’s 0.2 percentage points less than the month before, but still around levels last seen in the 1980s. The index was expected to show a year-over-year increase of 4.8% for May, according to Dow Jones.

Stubbornly high inflation levels and the Federal Reserve’s efforts to tackle a surge in prices have resulted in escalating recession worries.

On the data front, a final reading of the S&P Global manufacturing purchasing managers’ index for June will be released at 9:45 a.m. ET.

Institute for Supply Management manufacturing data for June, construction spending for May and light vehicle sales for June will all be released at 10 a.m. ET.

— CNBC’s Fred Imbert and Tanya Macheel contributed to this report.

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