Investors and those following the movement of interest rates look at the movement of Treasury yields as an indicator of things to come. Their rates are considered an important benchmark: Because Treasury securities are backed by the full faith and credit of the U.S. Treasury, they represent the rate at which investment is considered risk-free.
Click on the links below to find a fuller explanation of the term.
|This week||Month ago||Year ago|
|One-Year Treasury Constant Maturity||0.12||0.14||1.57|
|91-day T-bill auction avg disc rate||0.09||0.10||1.56|
|182-day T-bill auction avg disc rate||0.09||0.11||1.57|
|Two-Year Treasury Constant Maturity||0.17||0.17||1.53|
|Five-Year Treasury Constant Maturity||0.42||0.39||1.54|
|Ten-Year Treasury Constant Maturity||0.92||0.90||1.72|
|One-Year CMT (Monthly)||0.13||0.13||1.57|
Since investors in riskier investments command a higher return as compensation, the yields on many bonds and money market instruments are priced at a spread over the corresponding risk-free Treasury rate. Yields on money markets and certificates of deposit are often priced relative to yields on Treasuries of a similar length. Adjustable rate mortgages can be indexed to the one-year Treasury. Fixed mortgage rates are closely linked to movements in long-term Treasury yields, as mortgages are often packaged together and sold as mortgage-backed bonds. Yields on short-term Treasuries can behave differently from yields on longer-term Treasuries.