Treasury Yield Curve Analysis

The 30-year Treasury yield closed at 5.07 percent on Friday, down from 5.10 percent on Thursday and marking a five basis point decline compared to last Friday when it stood at 5.12 percent. This marks the third consecutive weekly decline for the long bond, which has retreated from the 5.14 percent level seen one week ago. The yield fell three basis points from Thursday to Friday as investors moved into longer-dated bonds during the session. The 30-year has dropped eight basis points from its recent peak reached last Thursday, though it remains well above levels seen earlier this year.

The broader curve showed mixed movements compared to last week, with gains concentrated at the front end and the middle of the curve while longer maturities declined. The 2-year yield rose to 4.13 percent from 4.09 percent a week ago, a four basis point increase that puts it at its highest level in several weeks. The 5-year climbed to 4.27 percent, up one basis point from last Friday, and the 10-year held at 4.56 percent, marginally lower than the 4.59 percent recorded a week prior. The 20-year fell three basis points this week to 4.56 percent, while the 7-year slipped two basis points to 4.41 percent. Short-term rates between four weeks and six months all moved higher compared to last Friday, with the 6-month reaching 3.79 percent from 3.77 percent.

Looking back one month to April 10th, the entire curve has shifted dramatically higher across nearly all maturities. The most striking increases occurred at the short end, where the 1-year rate jumped to 3.86 percent from 3.70 percent, a move of 16 basis points. The 2-year climbed to 4.13 percent from 3.81 percent, a 32 basis point rise over the month, while the 3-year surged to 4.18 percent from 3.80 percent, an increase of 38 basis points. The 5-year reached 4.27 percent compared to 3.94 percent one month ago, and the 10-year moved from 4.31 percent to 4.56 percent. Longer maturities also rose substantially, with the 20-year climbing to 5.06 percent from 4.89 percent and the 30-year moving to 5.07 percent from 4.91 percent.

The yield curve has steepened noticeably over the past month as shorter-dated rates moved up more aggressively than longer-term yields. The gap between the 2-year and 30-year widened to 94 basis points from approximately 110 basis points, though the shape differs significantly when comparing to last week. This week, the short end rose while the long end fell, reversing the pattern seen in recent weeks where longer maturities led the move higher. The curve remains positively sloped throughout, with rates increasing from 3.68 percent at the 3-month maturity up to 5.07 percent at the 30-year level. The most recent steepening has primarily been driven by the 2-year and 3-year segments, which have risen sharply over the past month while the 30-year has gained a more modest 16 basis points in comparison.