Treasury Yield Curve Analysis

The 30-year Treasury yield settled at 5.21 percent today, slightly higher than last week's 5.17. Most maturities moved lower over the past week, with short-term bills showing the largest drops. The 3-month bill fell from 3.95 to 3.82, the 2-year slid from 4.37 to 4.23, and the 1-year slipped from 4.15 to 4.04. The 10-year dipped from 4.71 to 4.68, while the 20-year held relatively steady near 5.21.

The broader curve showed a mixed picture this week. Short-term rates fell sharply, with bills from 4 weeks to 6 months all declining by roughly 0.10 to 0.13. Mid-range maturities like the 5-year dropped from 4.46 to 4.38, and the 7-year fell from 4.58 to 4.52. Longer-term yields were essentially flat, with the 20-year unchanged at 5.22 and the 30-year up just 0.04. The yield difference between 2-year and 10-year narrowed considerably compared to last week.

Looking back one month, yields have moved higher across nearly the entire curve. The 20-year jumped from 4.91 to 5.22 and the 30-year climbed from 4.90 to 5.21, each gaining 0.31. The 10-year rose from 4.46 to 4.68, a move of 0.22, while the 7-year increased from 4.34 to 4.52. The 2-year moved from 4.19 to 4.30, and short-term rates from 4 weeks to 6 months also edged higher by 0.06 to 0.11.

The curve today is steep through the 10-year maturity, then flattens considerably, with the 20-year actually trading slightly below the 30-year. This represents a shift from last week, when the 2-year was higher than the 10-year, creating a brief inversion. Over the past month, the entire curve has moved upward while steepening, with longer maturities gaining far more than shorter ones.