US Treasury yields ended a three-day losing streak on Wednesday, reversing course as Wall Street braced for the Federal Reserve’s interest rate decision later in the day.
The benchmark 10-year yield climbed, signaling that investors are increasingly skeptical of imminent rate cuts despite recent declines from July highs.
The shift in sentiment comes as markets digest growing inflation concerns that have complicated the central bank’s policy outlook.
Traders are now positioning for a more cautious approach from the Fed, with the yield curve reflecting a higher probability of rates staying elevated for longer.
The move underscores the tension between cooling economic data and persistent price pressures that have kept policymakers on edge.
Federal Reserve Chair Kevin Warsh is scheduled to hold a press conference following the announcement, where he is expected to address the committee’s assessment of inflation risks and the labor market.