Treasury Yield Curve Analysis

# Daily Treasury Brief: U.S. Rates Drop Across the Curve

The 30-year Treasury yield fell to 4.72 on Thursday, down from 4.85 at the same time last week. The long end of the market saw the biggest moves, with yields moving lower across the board. Investors in longer-dated bonds saw their returns improve as prices rose. The 20-year rate also declined, settling at 4.68 compared to 4.79 a week earlier.

Looking at the broader curve, the 10-year yield dropped to 4.09 from 4.21 last Thursday, a meaningful decline of 12 basis points. The 7-year rate fell to 3.87, while the 5-year dropped to 3.67. Shorter maturities were relatively stable, with the 2-year holding at 3.47 and the 1-year near 3.45. The 6-month rate remained at 3.58, while bills out to three months stayed in the 3.70 range.

Comparing to the prior week, most maturities have moved lower. The 10-year is down 12 basis points, the 7-year fell 10 basis points, and the 5-year declined 7 basis points. The 3-year dropped 6 basis points to 3.49. The short end was flat to slightly higher, with the 3-month and 4-month both at 3.70. The 6-month held steady at 3.58, and the 1-year ticked up just one basis point.

The curve shows a classic inverted shape between the 2-year and 10-year, a pattern that has persisted. Yields in the 2-year to 5-year zone cluster tightly between 3.47 and 3.67, while rates jump sharply at the 10-year point to 4.09. The 30-year at 4.72 sits just 7 basis points above the 20-year at 4.68, suggesting investors are not demanding much extra compensation for the longer maturity. Compared to last week when the 30-year was at 4.85, the entire long end of the curve has shifted down meaningfully, compressing spreads between major points.