Two-year Treasury prices fell Monday, pushing up yields, as investors prepared for an auction of fresh supply in thin, end-of-year trading.
The yield on the two-year Treasury note TMUBMUSD02Y, +2.90% rose 1.25 basis point to 1.0108% ahead of the sale of $26 billion in two-year notes. Yields rise as prices fall.
Short-term yields nudged higher ahead of Christmas last week, with prices remaining under pressure after the Federal Reserve earlier this month raised interest rates for the first time in nearly a decade but emphasized a “gradual” path toward normalizing rates.
The yield curve continued to flatten Monday, with the yield on the 10-year Treasury note TMUBMUSD10Y, +0.00% falling around 0.4 basis point to 2.2375%. The yield on the 30-year Treasury bond TMUBMUSD30Y, -0.38% fell 1.26 basis points to 2.9518%.
There are no major economic data releases scheduled for Monday and the economic calendar for the week is relatively light. The final round of economic data to be released in 2015—including November trade figures and the latest consumer confidence data on Tuesday, followed by pending home sales on Wednesday—is likely to add to the picture of an economy that’s gradually improving but that is still operating below its historic rate of growth.
