Traders work on the floor of the New York Stock Exchange (NYSE) on March 23, 2023 in New York City. The Dow was up over 200 points in morning trading a day after the Federal Reserve once again raised interest rates in an attempt to control inflation.
U.S. Treasury yields were flat on Friday as the bond market wrapped up a wild quarter that saw rates spike and then reverse lower on the regional bank crisis.
The 10-year Treasury yield was trading at around 3.53% after declining by around 3 basis points. The yield on the 2-year Treasury was up by more than 2 basis points at 4.12%.
Yields and prices move in opposite directions. One basis point equals 0.01%.
The collapse of Silicon Valley Bank and ensuing banking crisis spurred chaos in bonds in March. The yield on 2-year notes soared past 5% for the first time since 2007 in early March, before staging its biggest three-day decline since 1987. A mixed bag of investor expectations that preceded the last FOMC meeting also added to the unease this quarter.
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Yields were flat even as February's personal consumption expenditures price index, one of the Fed's favored inflation measures, showed a less-than-expected increase in prices. The core Personal Consumption Expenditures index, which excludes energy and food costs, rose 0.3% in February, less than the 0.4% expected by economists polled by Dow Jones.
Speaking at an National Association for Business Economics event on Thursday, Boston Fed President Susan Collins said that inflation is still too high and more needs to be done to bring it down. That would likely include further tightening for now, but rate hikes could be paused soon, Collins said.
Investors will be scanning fresh comments from Fed officials slated to speak on Friday. Also on Friday, personal income and spending figures are due.
