Treasury Yield Curve Analysis

The 30-year Treasury yield came in at 5.06 percent on Friday, holding steady compared to last Friday when it also finished at 5.06 percent. The 10-year yield fell to 4.55 percent from 4.56 percent a week ago, while the 2-year rate dropped to 4.18 percent from 4.21 percent the prior Friday. Shorter maturities showed mixed movement this week, with the 1-year rate declining to 4.01 percent from 4.06 percent, though the shortest bill, the 4-week, rose to 3.73 percent from 3.71 percent. The 20-year yield dipped slightly to 5.07 percent from 5.08 percent last week.

The yield curve remained upward sloping Friday, with rates climbing from 3.73 percent at the 4-week maturity to 5.06 percent at the 30-year end. Most maturities across the curve finished lower than yesterday, with the 30-year down 3 basis points to 5.06 percent and the 10-year falling 2 basis points to 4.55 percent. The 2-year and 3-year each moved 2 basis points lower to 4.18 and 4.21 percent respectively. The short end showed minimal change, with the 6-week holding at 3.75 percent and the 2-month declining just 1 basis point to 3.80 percent.

Looking back one month, the most significant shifts occurred at the front end of the curve. The 6-month rate climbed to 3.96 percent from 3.81 percent, a notable 15 basis point increase over 30 days. The 1-year yield rose to 4.01 percent from 3.88 percent, gaining 13 basis points. The 4-month maturity jumped to 3.91 percent from 3.78 percent, while the 2-month rate moved up 9 basis points to 3.80 percent. The middle of the curve showed more stability, with the 5-year little changed at 4.28 percent and the 10-year steady at 4.55 percent. The long end moved modestly higher, with the 30-year up 5 basis points from 5.01 percent a month ago.

The curve has flattened compared to both last week and one month prior, with the gap between the 2-year and 10-year narrowing to 37 basis points from 35 basis points last week and 38 basis points a month ago. The 1-year and 2-year yields have compressed to nearly the same level, separated by just 17 basis points Friday. The 30-year remains 51 basis points above the 10-year, maintaining the typical bull steepener pattern where longer rates exceed shorter ones. The shortest maturities have shown the most volatility over the month, with the 6-week rising 4 basis points and the 2-month climbing 9 basis points, while the 20-year gained 4 basis points from one month ago, settling at 5.07 percent.