The yield on the benchmark 10-year Treasury note fell below 2.75 percent Thursday — its lowest level since Feb. 6 — as global investors remained wary amid a wider sell-off in equity markets.
The yield on the benchmark 10-year Treasury note was lower at around 2.741 percent at 3:58 p.m. ET, while the yield on the 30-year Treasury bond was lower at 2.972 percent. Bond yields move inversely to prices.
The moves in the bond market come after the 10-year Treasury yield hit its lowest in seven weeks on Wednesday, with investors on edge following a recent decline seen in U.S. stock markets. The 10-year yield broke through the key psychological level of 2.8 percent on Tuesday and has yet to recover amid a volatile equity market.
"It's important to point out that long-term yields are dropping is because long-term inflation expectations are dropping," said Aaron Kohli, interest rate strategist BMO Capital Markets. "The point we've been making is not that we're worried about any specific risk, but as the Federal Reserve tightens, the risk that a random shock is going to create more stress in the markets becomes more real."
The margin between U.S. shorter-dated and longer-dated Treasury yields shrank to its smallest in a decade on Thursday as Wall Street's expectations for upcoming rate hikes from the Federal Reserve contrasted with a long-term belief that inflation will stay tame. The spread between the yield on the 10-year Treasury note and the yield on the two-year Treasury note fluctuated around 47 basis points on the week's last day of trading.