10-Year Treasury Yield Holds Near 5% as Federal Reserve Opens Two-Day Policy Meeting

The 10-year U.S. Treasury yield settled just below 5%, hovering around 4.98-4.99%, as the Federal Reserve kicked off its two-day policy meeting on Tuesday, October 27. Investors were positioned cautiously ahead of Wednesday's rate decision, with the Fed weighing persistent inflation against a reluctance to raise rates further this cycle. The 30-year yield stood at 5.305% and the 5-year at 4.840%, with most maturities seeing only modest moves of 1-2 basis points on the day.

The stability in yields on Tuesday follows a sharp reversal from recent highs. The 10-year had briefly surged to 5.35% before retreating below 5% last week, a move driven in part by an AI-stock selloff that pushed investors into Treasuries as a safety trade. French fiscal turmoil also contributed to pressure on European sovereign debt, with spillover effects into global bond markets.

Equities were mixed on the day. The S&P 500 rose about 0.6% and the Nasdaq gained 1.2%, led by semiconductor stocks, while the Dow was roughly flat. Large-cap value shares were little changed and small-cap growth outperformed. Gold and bitcoin moved higher while oil declined. A Bloomberg report warned that bullish Treasury bets face reversal risk if the Fed strikes a hawkish tone at its meeting, a concern that kept positioning restrained ahead of the decision.