U.S. Treasury yields fell on Tuesday as questions lingered over the path ahead for interest rate and when cuts may begin.
The 10-year Treasury dropped about 8 basis points to 4.087%. The 2-year Treasury yield was also down more than 7 basis points to 4.397%.
Yields and prices move in opposite directions. One basis point equals 0.01%.
Treasurys
Investors have been fretting over the timeline for interest rate cuts from the Federal Reserve as concerns that elevated rates could drag the U.S. economy into a recession persist.
Some traders had been hoping for rate cuts as soon as March, but recent comments from Fed Chair Jerome Powell dampened these expectations. Strong economic data in recent days, including a hot January jobs report, have further contributed to those fears.
After the Fed meeting last week, Powell suggested that while rate cuts are likely to take place this year, the probability of that happening in March was low. He reiterated that sentiment over the weekend, noting that the pace of rate cuts would probably be slower than markets are expecting.
Markets were last pricing in just a 19.5% chance of a rate cut taking place then, according to CME Group's FedWatch tool.