US 10-Year Yield Stabilizes at 5% Amid Fed Rate Hike

The US 10-year Treasury note yield has stabilized at 5% after the Federal Reserve raised interest rates for the first time in three years. The Fed funds rate was lifted to 3.75%-4%, as expected, with a 25 basis point increase. Inflation remains elevated, according to Federal Reserve Chair Kevin Warsh, who noted that core US inflation rose more than anticipated in August. Surging energy prices and a growing supply of corporate debt have also contributed to Treasury note pressure.

Warsh pointed out that Treasuries face competition for investor capital due to the increasing corporate debt supply. President Donald Trump called for rates to be quickly reduced to 1% or below, although he stopped short of criticizing Warsh's stance on inflation and interest rates.