U.S. Treasury Yields Fall as Markets Look to U.S. Inflation Data

By Emese Bartha

U.S. Treasury yields fell in the Asian session on Tuesday as they resumed trading after Monday's market holiday due to Columbus day, with the decline helped by lower oil prices.

The 10-year Treasury yield last traded 4.4 basis points lower at 5.199%, while the 30-year Treasury yield declined 4.1 basis points to 5.557%, according to Tradeweb. They are now safely below their respective 24-year highs of 5.365% and 5.733%, reached last week.

Market participants are focussed on U.S. consumer price inflation data for September on Wednesday as a key input ahead of the Federal Reserve's next interest-rate decision on Oct. 28. For that meeting, markets currently price in a low 19% probability of an interest-rate hike even as a total of three hikes are fully priced over the next 12 months, according to LSEG.

A Wall Street Journal poll of analysts predicts the headline CPI in September will rise 3.6% compared with the same period a year earlier, after August's 3.4% increase.

An anticipated acceleration in September consumer inflation is unlikely to prompt the Fed to raise rates in October, said Thierry Wizman, global FX and rates strategist at Macquarie Group, in a note.

"We do not believe that the report will sway the Fed into hiking later this month," he said.

Analyst also see tentative signs that the recent selloff in U.S. Treasurys might cool.

DZ Bank analysts estimate that the term premium--the additional yield investors demand for buying a longer-dated bond versus a shorter-dated one--on the 10-year U.S. Treasury yield is 91 basis points, in line with the average level since the early 1990s but also the highest level since 2014.

This, together with the anticipated scaling back of markets' hawkish interest-rate expectations, keeps the scope for further rises in yields manageable, they said.

Write to Emese Bartha at emese.bartha@wsj.com

(END) Dow Jones Newswires

October 13, 2026 02:18 ET (06:18 GMT)