The benchmark 10-year Treasury yield fell on Wednesday after the Federal Reserve held interest rates steady, pointing to increasing uncertainty in the outlook for the U.S. economy.
The 10-year Treasury yield was more than 3 basis points lower at 4.281%. The 2-year Treasury yield was little changed at 3.797%.
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WATCH HEREOne basis point is equal to 0.01% and yields and prices move in opposite directions.
The Federal Open Market Committee left its federal funds rate in a range of 4.25%-4.5%. That range has remained in place since December, when the Fed cut rates by a quarter percentage point.
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SIGN UP "Uncertainty about the economic outlook has increased further," the Fed's post-meeting statement said. "The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen."
Traders have been concerned that U.S. President Donald Trump's tariff plans could elevate inflation, complicating the path for interest rate decisions. Ahead of Wednesday's decision, they were pricing in a nearly 98% chance that the central bank would hold borrowing rates steady, as per the CME Group FedWatch Tool.
The Fed's meeting comes after Trump repeatedly criticized Fed Chairman Jerome Powell and pressured the central bank leader to lower rates, even threatening to fire him. Trump later walked back those comments, saying he had "no intention" of firing Powell.
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There are also hopes that the U.S. and China will strike a trade deal after government spokespeople said U.S. Treasury Secretary Scott Bessent and top trade official Jamieson Greer would meet with their Chinese counterparts this week in Switzerland. There's optimism that trade negotiations are underway after Trump announced sweeping "reciprocal" tariffs in April.
