Treasury yields little changed as investors await fresh inflation insights

U.S. Treasury yields held steady on Thursday as investors assessed the outlook for Federal reserve monetary policy and awaited key economic data that could give fresh inflation insights.

At 3:34 a.m. ET, the 10-year Treasury yield was up by less than one basis point to 4.2724%, after having fallen below 4.3% for the first time since September on Wednesday.

The 2-year Treasury yield was last less than one basis point higher at 4.6533%. It had hit its lowest level since mid-July on Wednesday.

Yields and prices have an inverted relationship and one basis point equals 0.01%.

Yields had fallen on Wednesday as equities rallied after a reading of third-quarter U.S. gross domestic product showed that the economy grew by more than expected at 5.2% annualized pace.

Investors weighed the path ahead for interest rates as hopes of the Federal Reserve being done with its rate-hiking cycle have grown in recent days and weeks. Fed Governor Christopher Waller suggested earlier this week that monetary policy was in a good position to help ease the economy.

Interest rates are expected to remain unchanged when the Fed meets in December, and investors are hoping that the central bank will also provide them with clues about when rates could be cut then. Fed officials have not yet addressed this question, and Fed Chairman Jerome Powell has said rate cuts were not discussed at the central bank's last meeting.

Several key data points that could inform policymakers' thinking are due before the meeting, including October's personal consumption expenditures price index on Thursday. This is the Fed's favored inflation measure.

Also on Thursday, initial weekly jobless claims and pending home sales for October are expected and euro zone inflation data for November will be published.