#U.S. Treasury yields moved lower during the European trading session as investors turned cautious ahead of several key U.S. economic data releases that could influence the Federal Reserve’s policy outlook. Market participants are closely watching upcoming ISM Services PMI, ADP employment, and JOLTS labor market data for signals on economic momentum and inflation pressures.
According to analysts at Kudotrade, the pullback in yields reflects a wait-and-see stance rather than a strong directional bet. Current pricing in the currency market (per LSEG) suggests expectations for two Fed rate cuts later this year.
Yield moves (Tradeweb):
2-year Treasury: down 1.4 bps to 3.458%
10-year Treasury: down 3.7 bps to 4.141%
30-year Treasury: down 4.2 bps to 4.823%
What this means for markets:
📉 Falling yields signal softer near-term expectations for Fed tightening and growing sensitivity to incoming data.
💵 FX markets are leaning toward easing expectations, which could cap dollar strength if data comes in weaker.
📊 Risk assets (equities, crypto) may benefit short term if the data supports the rate-cut narrative—but volatility could rise if numbers surprise to the upside.
