US Treasuries rally as 10-year yield posts biggest monthly drop since 2023
The 10-year US Treasury yield fell 36 bps in October, its steepest monthly decline since December 2023, as tech stocks sold off and December Fed hike bets stayed high.
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what happened
According to Reuters, US Treasuries gained on Friday, and the 10-year yield closed the month with its largest monthly drop in nearly three years. The move came as a sharp sell-off in technology stocks sent the Nasdaq down more than 2% after earnings from Amazon and Intel, pushing investors toward safe-haven assets.
The 10-year yield fell 36 basis points in October, the biggest monthly decline since December 2023. It was last at 4.925%, and the two-year yield, which usually tracks Fed rate expectations, dropped 8.1 bps. Earlier in the month, yields had hit multi-decade highs on concerns about energy costs and government debt.
Expectations for a December Fed rate hike remain elevated, with CME FedWatch data showing about a 70% chance of a quarter-point increase. Dallas Fed President Lorie Logan said on Friday the central bank needs to raise rates at least two more times to bring inflation under control.
why it matters
The bond rally at the end of the month reflects a shift in sentiment, as investors grow more worried about the cost of AI spending and its effect on growth stocks. Still, firm inflation and faster third-quarter growth keep bets on higher rates alive, so the next moves in yields will likely depend on whether tech-sector jitters persist.
market impact
US Treasuries: safe-haven demand lifts prices and lowers yields; Nasdaq under pressure from AI-spending worries
- US Treasuries pressure up — safe-haven demand after the tech stock sell-off supports bond prices
- Nasdaq pressure down — Amazon and Intel earnings intensified worries about AI spending costs
tags
instruments
sources
- US bonds rally, sending yields to biggest monthly decline since 2023 — Reuters, 30 October 2026 at 20:24 UTC
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