Treasury Yield Curve Analysis

The 30-year Treasury yield closed at 5.10 percent Thursday, up 8 basis points from 5.02 percent one week ago and down slightly from 5.11 percent Wednesday. This long-term rate has climbed notably higher over the past month, rising from 4.90 percent in early April, representing a gain of 20 basis points in just six weeks.

The broader yield curve shifted higher across nearly all maturities this week. The 10-year rate moved to 4.57 percent compared to 4.47 percent last Thursday, while the 5-year climbed to 4.25 percent from 4.13 percent. The 2-year rate settled at 4.08 percent versus 4.00 percent one week ago. Short-term rates were mixed, with the 3-month actually declining slightly to 3.68 percent from 3.69 percent, while the 1-year rose to 3.83 percent from 3.79 percent.

Looking at the past month, the curve has moved substantially higher with medium-term maturities seeing the largest increases. The 3-year rate climbed to 4.13 percent from 3.77 percent a month ago, a gain of 36 basis points. The 5-year rose to 4.25 percent from 3.91 percent, up 34 basis points. The 2-year increased to 4.08 percent from 3.78 percent, adding 30 basis points. Front-end rates moved more modestly, with the 6-month at 3.78 percent versus 3.71 percent one month ago and the 3-month holding relatively flat at 3.68 percent.

The curve has steepened over both the short and medium term. The gap between the 30-year and 3-month widened to 142 basis points from 134 basis points last week and 122 basis points a month ago. The 10-year to 2-year spread widened to 49 basis points from 47 basis points a week ago and 51 basis points a month ago, suggesting a more pronounced upward slope in the middle portion of the curve.