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Yield on two-year Treasury note topped 5% for the first time since 2007 just last week.
It traded 4.126%, on track for its biggest one-day decline since 2001.
Yield fallen faster than in any three-session stretch since 1987
The yield on the 10-year Treasury note—a key borrowing benchmark that reflects investors’ longer-term outlook for economic growth, inflation and interest rates—fell to 3.53% from 3.694% Friday.
Investors and economists closely watch Treasury yields because they set a floor on interest rates across the economy and serve as a benchmark against which other financial assets are valued.
The Fed’s rapid rate increases sent yields surging last year, sparking stock declines and helping send the average 30-year mortgage rate as high as 7%.
Federal-funds futures, which traders use to bet on interest-rate moves, showed Monday morning a 64% chance that the Fed would still raise rates by 0.25 percentage point at its meeting next week, and a 36% chance that it wouldn’t move at all, according to CME Group data.