The 10-year Treasury yield fell 13 basis points to 4.653% on Wednesday morning, following slower-than-expected inflation data. The move reverses Monday’s 14-month high.
The core consumer price index (CPI), excluding volatile food and energy prices, slowed to 3.2% in December, beating economist expectations by 0.1 percentage point. Core inflation grew 0.2% on the month, while the non-core index rose 0.4%.
Analysts at Goldman Sachs said the data should help alleviate concerns about a reacceleration of inflation. However, they noted that it may not be enough to put pressure on the Federal Reserve to cut interest rates.
The producer price index showed wholesale prices rose less than expected in December, which helped ease investor concerns over a resurgence in inflation. But market expectations for the Fed’s January meeting remain unchanged.
The next key data point is retail sales and housing starts, set to be released later in the week.
Source: https://www.cnbc.com/2025/01/15/treasury-yields-consumer-price-index.html