Treasury Yield Curve Analysis

The 30-year Treasury yield settled at 4.83 percent Tuesday, down from 4.91 percent one week ago but slightly higher than yesterday's 4.80 percent. The long end of the market has stabilized this week after experiencing some upward pressure recently. Yields on government bonds with three decades to maturity have trended lower over the past week, offering modest relief for borrowers seeking long-term financing costs. This rate remains the highest across the entire Treasury curve.

Shorter-term rates showed mixed movement compared to last Tuesday, with the front end of the curve little changed while the belly experienced notable declines. The 10-year yield dropped to 4.24 percent from 4.30 percent a week prior, while the 5-year fell to 3.81 percent from 3.86 percent. The 2-year rate decreased to 3.53 percent from 3.60 percent over the same period. In contrast, very short-term maturities such as the 4-week and 6-week bills inched higher, with the 4-week rising to 3.77 percent from 3.75 percent.

Looking back 30 days to mid-December, the curve has shifted upward in a notable pattern. The 3-year yield climbed to 3.65 percent from 3.52 percent, while the 5-year rose to 3.81 percent from 3.69 percent. The 7-year increased to 4.03 percent from 3.90 percent, and the 10-year moved to 4.24 percent from 4.15 percent. Medium-term maturities showed the most pronounced monthly increases, while the 30-year barely moved at all, ticking up just one basis point over the full month to land at 4.83 percent.

The yield curve continues to maintain a positively sloped shape from the 2-year through 30-year maturities, though the steepness varies across different segments. The 2-year sits at 3.53 percent while the 10-year reaches 4.24 percent, creating a spread of about 71 basis points. This slope has widened considerably over the past month as medium-term rates rose more sharply than long-term rates. The short end including bills and the 1-year note remains compressed in the 3.50 to 3.77 percent range, while longer maturities from 10 years onward extend well above 4.20 percent.