10-year Treasury yield hits 2-week high despite Fed rate cut this week

Group 1 - U.S. Treasury yields increased, with the 10-year note yield rising to 4.135% and the 2-year yield to 3.578%, marking the highest intraday yields in two weeks [1][2][3] - The rise in longer-dated Treasury yields is seen as counterintuitive given the decline in short-term rates, as investors consider future economic growth, inflation, and government financing needs [3] - The Federal Reserve cut its benchmark overnight lending rate by 0.25 percentage points to a range of 4.00%-4.25%, with indications of potential further cuts in upcoming meetings [4][5] Group 2 - Recent labor market data showed a significant decline in initial jobless claims, the largest weekly drop since 2021, alleviating concerns about an economic slowdown [5] - Investors are awaiting the August personal consumption expenditures index, which is the Fed's preferred inflation measure, for insights into inflation trends and economic impacts [6]