Treasuries Jolted as Fed Hold Trims September Hike Bets

On July 29, 2026, the Federal Reserve decided to maintain interest rates, leading to significant shifts in US Treasury yields. Following the announcement, the yield on two-year US government notes decreased by two basis points to 4.26%, whilst the 30-year yield increased by five basis points to 5.14%. This decision influenced bond traders to adjust their expectations for a rate hike in September, as prior to the announcement, there had been a 40% likelihood of such an increase.

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The US Treasury building in Washington.

The US Treasury building in Washington. Photographer: Al Drago/Bloomberg

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By Michael MacKenzie

July 29, 2026 at 6:15 PM UTC

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US Treasury yields shifted dramatically after the Federal Reserve kept interest rates steady, pushing bond traders to pare back their expectations for a hike in September.

The moves on Wednesday pushed yields on two-year US government notes — which are most sensitive to changes in the Fed’s policy — lower by two basis points to 4.26%, while the 30-year yield was higher by five basis points at 5.14%. The decision offered a dose of clarity to a deeply divided market that had seen traders betting on a 40% chance of a hike earlier in the day.

Read Original at Bloomberg →