Federal Reserve Chairman Jerome Powell speaks during a press conference after the Federal Open Market Committee at the Federal Reserve Board on June 14, 2023 in Washington, DC.
Mandel Gunn | AFP | Getty Images
U.S. Treasury yields rose on Wednesday as investors awaited the outcome of Jerome Powell’s final policy meeting as Federal Reserve Chairman.
The yield on the 10-year Treasury note, a key measure of U.S. government borrowing, rose more than 3 basis points to 4.388%. The two-year Treasury yield, which is more closely tied to the Federal Reserve’s short-term interest rate policy, also rose more than 3 basis points to 3.883%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
The Fed’s two-day monetary policy meeting concludes on Wednesday, with outgoing Fed Chair Jerome Powell and the Federal Open Market Committee widely expected to keep interest rates at their current levels of 3.50% to 3.75%.
He is expected to lead other policymakers into another cautious pause, as stubborn inflation and a resilient labor market leave little room for rate cuts.
“The dual mandate would say we’re in a pretty much stable labor market,” Roger Ferguson, an economist and former Fed vice chairman, told CNBC. “On the inflation side of the mandate, there’s still a lot of work to do to keep (inflation) at 3%. I hope they say, ‘We’re going to sit back and see how this situation plays out for a while.'”
Kevin Warsh, Powell’s likely successor, appears to be on track to take control of the central bank. The Senate Banking Committee voted to advance his nomination on Wednesday, and the Senate will now take a final confirmation vote.
Sen. Thom Tillis said Sunday he was prepared to stop blocking Warsh’s nomination after the Justice Department dropped its criminal investigation into Powell. Mr. Tillis’ support makes confirmation of President Donald Trump’s nomination to lead the Fed all but certain.
—CNBC’s Jeff Cox and Matt Peterson also contributed to this report.
