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10-year Treasury yield dips after topping 5%

Chris Wattie | Reuters

U.S. Treasury yields ticked lower Monday, hovering around multiyear highs as investors continue to assess the prospect of higher-for-longer interest rates from the Federal Reserve.

The yield on the benchmark 10-year Treasury note fell by 8 basis points to 4.84%, while the yield on the 30-year Treasury bond slipped around 6.8 basis points to 5.02%. Yields move inversely to prices.

The 10-year yield is pulling back from the 5% level, which it hit for the first time since July 2007 on Thursday. Yields fell after Pershing Square's Bill Ackman on Monday disclosed he covered his bond short position.

Ackman asserted that "there is too much risk in the world to remain short bonds at current long-term rates" in a post on social media platform X. Ackman tied the move to a view that bonds could soon see safe haven interest as equities remain volatile and troubled by geopolitical risk.

Markets are also contending with comments by Federal Reserve Chairman Jerome Powell from last week. Powell the central bank would remain "resolute" in its commitment to bring inflation down sustainably to 2% and that lower economic growth was likely needed to achieve this goal.

Fed fund futures pricing reflects a 98% probability that the central bank keeps its main interest rate unchanged at the current target range of 5.25-5.5% at its next monetary policy meeting.

Auctions will be held Monday for $75 billion of three-month Treasury bills and $68 billion of six-month bills.

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