Investors Await Economic Data to Dictate Interest Rate Decisions: The Latest on Treasury Yields and Upcoming Key Indicators

On Monday, the yield on the 10-year Treasury rose by two basis points to 4.647%, as investors eagerly awaited upcoming economic data that could shed light on the state of the economy and the future of interest rates. Meanwhile, the 2-year Treasury yield was down by 2.6 basis points to 4.97%.

Yields and prices move in opposite directions, with one basis point equating to 0.01%. Various key data points are expected later in the week, such as the personal consumption expenditures price index for March, which is the Fed’s preferred inflation measure. This data could influence policymakers’ decisions leading up to the next Federal Reserve policy meeting on April 30-May 1.

Other important data anticipated this week includes durable goods orders and a GDP reading for the first quarter of 2024. Recent economic indicators showing steady inflation and economic strength have led investors to delay their expectations for rate cuts by the Fed.

Federal Reserve officials, including Chairman Jerome Powell, have suggested that there is no immediate need for rate cuts and that any decisions will depend on how the economy evolves. The Fed has now entered a “blackout period” leading up to their upcoming meeting. Despite this, investors remain optimistic about future economic growth and are closely watching key data points as they make investment decisions.