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U.S. Treasury yields retreated on Friday after the 10-year note briefly hit the highest level since January 2025 on Thursday, when Brent crude oil climbed above $100 per barrel and reignited inflationary fears.
The yield on the 10-year U.S. Treasury note — the key benchmark for mortgage and auto loans and credit card debt — was last down more than 3 basis points at 4.671%. On Thursday, it had risen above 4.7%, the highest since Jan. 15, 2025, before the start of President Donald Trump’s second term.
The 2-year Treasury note yield, which more closely tracks short-term Federal Reserve interest rate policy, also pulled back more than 3 basis points, to 4.328%. The longer-dated 30-year Treasury bond yield was down 2 basis points, to 5.151%.
One basis point equals 0.01%, and yields and prices move inversely to one another.
Yields remained lower after the S&P Global Flash U.S. purchasing managers index — which measures the economic health of American manufacturing and the service sector — moved down slightly in July to 53.8, below the 54.4 that economists polled by Dow Jones had estimated.
President Trump said he will soon make a decision on whether to launch a “massive attack” on Iran after the conflict in the Middle East expanded to a new battleground in the Red Sea earlier this week as Houthi rebels in Yemen threatened oil tankers.
Speaking to Axios on Thursday, the president said any proposed strikes would be bigger than what’s been seen in the war so far, and that Iran has not “received enough pain yet.”
“I am considering a massive attack. Bigger than ever before. I am close to making a decision. We are all set for it,” Trump said in the interview.
U.S. forces have pummeled Iranian targets over the past two weeks, with Central Command completing a 13th consecutive night of strikes overnight.
Also on Thursday, jobless claims for the week ended July 18 came in at 187,000, below the 212,000 that economists polled by Dow Jones were expecting, signaling that the labor market remains healthy.
— CNBC’s Chloe Taylor contributed to this report.
