Treasury yields retreat as Fed Chair warns on keeping rates elevated for too long
U.S. Treasury bond yields were little changed on Wednesday after Federal Reserve Chair Jerome Powell warned that keeping interest rates elevated for too long could stunt economic growth.
The 10-year Treasury yield was roughly 2 basis point lower at 4.278%. The 2-year Treasury note yield was little changed at 4.626%.
Yields and prices move in opposite directions. One basis point is equivalent to 0.01%.
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WATCH HEREPowell said Tuesday that the economy and labor market remain strong, despite some recent cooling.
"At the same time, in light of the progress made both in lowering inflation and in cooling the labor market over the past two years, elevated inflation is not the only risk we face," he said in prepared remarks at Capitol Hill. "Reducing policy restraint too late or too little could unduly weaken economic activity and employment."
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SIGN UP Powell added that policymakers remain resolved on their goal of bringing inflation down to the 2% target as he cited some easing in prices.
The central bank leader's speech was part of a two-day appearance at Capitol Hill. He appeared before the Senate Banking Committee to deliver his semiannual monetary policy report to Congress and continued testimony the House Financial Services Committee on Wednesday.
Money Report
Investors are also awaiting key economic data such as the June consumer price index reading due Thursday and the producer price index slated for Friday. The CPI pint is seen as a key test for the market and the outlook for rate cuts.
