U.S. Treasury yields rose on Wednesday after the Fed held interest rates steady during Kevin Warsh’s first policy meeting as chairman.U.S. Treasury yields rose on Wednesday after the Fed held interest rates steady during Kevin Warsh’s first policy meeting as chairman.
U.S. Treasury yields rose on Wednesday after the Kevin Warsh-led Federal Reserve held interest rates steady and removed key language indicating a bias towards future cuts, with many central bank officials signaling potential hikes in 2026.
The 2-year Treasury note yield, which more closely tracks short-term Fed interest rate policy, climbed 9 basis points to 4.134%. The longer-dated 30-year Treasury bond yield added less than 2 basis points to 4.946%.
The yield on the 10-year U.S. Treasury note — the key benchmark for U.S. government borrowing — rose less than 4 basis points to 4.467%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
This week’s Federal Open Market Committee meeting marked the first under Kevin Warsh at the helm.
The median estimate for the Fed Funds Rate to end 2026 is now 3.8%, up from 3.4% in the prior projections from March and signaling the committee sees at least one rate hike as necessary this year. Complicating the forecast is that one of the 19 officials did not submit a projection and that was likely Warsh.
The FOMC’s post-meeting statement also pared down prior language that hinted towards an easing slant in the future.
“While the rate didn’t change, shifts in the dot-plot, votes and language from the Fed meeting have financial markets a bit on edge,” said Gina Martin Adams, chief market strategist at HB Wealth. “Despite recent news suggesting some inflation reprieve may be coming with a peace deal in the Middle East, the Fed is increasingly concerned about the inflation landscape.”
— CNBC’s Jeff Cox contributed to this report.
