U.S. Treasury Yields Rise Sharply After Historic Government Shutdown Ends
Following the conclusion of the longest government shutdown in U.S. history, Treasury yields surged on Thursday as investors welcomed the return to normalcy and reduced fiscal uncertainty.
Significant Shifts in Treasury Market Rates
The 10-year Treasury note yield climbed by 4 basis points, reaching 4.119%, while the 2-year note increased by more than 2 basis points to close at 3.595%. Meanwhile,the yield on the 30-year bond jumped by 5 basis points to hit 4.712%. For clarity, a single basis point represents one-hundredth of a percent (0.01%), and it’s crucial to remember that bond prices move inversely to yields.
End of Shutdown through Legislative Approval
On Wednesday night, President Trump signed into law a funding bill that terminated a government shutdown lasting an unprecedented 43 days-the longest ever recorded in American history. Earlier that evening, the House of Representatives approved this measure with a vote count of 222-209.
Effects on Federal employees and Economic Reporting
“This shutdown was never intended,” President Trump remarked, underscoring how over one million federal workers endured furloughs without pay during this period.
The prolonged closure also delayed critical economic releases such as consumer price index (CPI), producer price index (PPI), and nonfarm payroll reports-key indicators used globally for gauging economic performance.
Ongoing Concerns About Economic Data Reliability
The White House press secretary voiced worries that some essential statistics might remain unpublished due to disruptions caused by the shutdown’s length and scope. This gap threatens long-term trust in federal data systems at a time when accurate details is vital for decision-making bodies like the federal reserve.
“The Democrats may have permanently damaged the Federal Statistical system with October CPI and jobs reports likely never being released,” warned Karoline Leavitt, emphasizing how missing data complicates policymaking amid volatile economic conditions.
