10-year Treasury yield falls to 4% then snaps back as traders assess inflation data

Group 1 - The yield on the benchmark 10-year Treasury was last unchanged at 4.032%, after falling to 4% earlier in the session, while the 30-year Treasury yield increased to 4.688% [1] - The August consumer price index rose by a seasonally adjusted 0.4% for the month, with an annual inflation rate of 2.9%, aligning with economists' expectations [2] - Weekly jobless claims rose to a seasonally adjusted 263,000, exceeding the estimate of 235,000 and increasing by 27,000 from the previous period [2] Group 2 - The recent data indicates limited inflationary impact from the trade war and raises concerns about a weakening labor market, suggesting a potential 25 basis point interest rate cut next week [3] - A surprise decline in the producer price index supports expectations for a Federal Reserve interest rate cut at the upcoming meeting on September 17, with wholesale prices falling by 0.1% month-on-month [3] - Markets are pricing in a September interest rate cut with a 94% probability of a quarter-point cut and a 6% chance of a half-point cut [4]