US Treasury yields have been on a downward trend, with 10-year Treasury notes recently dropping below 4% for the first time in nearly six months. Following the release of Friday's jobs report at 8:30 am ET, yields have continued to decline, now hovering around 3.85%.
This decrease in yields is indicative of investors' increasing confidence in the Federal Reserve taking action at its upcoming meeting in September. There is a growing expectation that the Fed will not only lower interest rates but may opt for a more substantial half-point cut.
For individuals affected by rising interest rates, such as borrowers and prospective homebuyers, the fall in Treasury yields brings potential relief. As Treasury yields influence interest rates, the decline suggests that interest rates for loans and mortgages are likely to decrease in the near future.
