The yield on the 10-year US Treasury note eased slightly to around 4.26% on Thursday but remained close to its highest level since August, supported by expectations that the Federal Reserve may hold off on interest rate cuts. Fed Governor Lisa Cook emphasized concerns over stalled inflation progress rather than a slowing labor market, indicating she would not support rate reductions until price pressures ease. Investors also weighed the implications of Kevin Warsh’s nomination as Fed chair, noting his preference for a smaller Fed balance sheet and a more measured approach to rate cuts. On the data front, the ADP report showed private employment growth fell well below expectations, while services activity exceeded forecasts. Meanwhile, the US Treasury maintained its issuance guidance for upcoming quarters, favoring a larger share of short-term bills over longer-term bonds to help manage borrowing costs amid elevated interest rates.
