US Treasury yields fall ahead of Fed remarks

U.S. government debt yields fell Monday after reaching four-year highs just under 3 percent last week.

The yield on the benchmark 10-year Treasury note was lower at around 2.859 percent at 3:16 p.m. ET, while the yield on the 30-year Treasury bond was lower at 3.155 percent. Bond yields move inversely to prices.

The 10-year yield neared its lowest level since Feb. 14, when the 10-year yielded as low as 2.808 percent.

Testimony from new Federal Reserve Chair Jerome Powell on Tuesday and key inflation data are expected to keep fixed-income markets on edge this week.

While investors remained on edge over the prospect of higher interest rates, U.S. government debt prices came under pressure Monday and during Friday's session, alleviating some concern.

"I would think there's no upside for [Powell] making a splash because he's dealing with a committee that's in flux, just coming together," said Robert Tipp, chief investment strategist at PGIM Fixed Income. "The market tends to do a good job of panicking and defining the range you're likely to be in ... Once the taper tantrum got going, 3 percent was the watermark."

Consequently, investors in the bond market will be turning their attention to the U.S. Federal Reserve and economic data, in the hope of any additional clues as to how the U.S. economy is performing.

Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
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US 2-YR
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US 5-YR
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US 10-YR
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US 30-YR
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In other data news, sales of new homes fell for a second straight month in January. The Commerce Department said on Monday that sales dropped 7.8 percent; economist polled by Reuters had forecast new home sales up nearly 4 percent.

The contraction in sales is being blamed largely on a shortage in houses as well as rising mortgage rates.