Treasury Rates Update: December 18th, 2025
- Bill Knudson
- 20 hours ago
- 1 min read
Following the flurry of activity surrounding the Federal Reserve's December 10th meeting, the Treasury market entered a period of relative calm this week. While we saw some volatility earlier in the month, the current environment suggests a market that is in digestion mode, weighing recent policy shifts against new economic data.
Upcoming Key Economic Data Release:Â Â
Next net new job release is January 9
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Next inflation release January 13
Next Fed meeting is January 28Â
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Key Developments
The 10-year Treasury rate finished the week down 2 basis points (bp). This minor weekly decline leaves the rate up just 1bp over the past two weeks, a stark contrast to the sharper movements observed at the start of the month.
Key takeaways from the current yield curve dynamics include:
The short end remains a focal point, with the 1-month rate sitting significantly above the 1-year rate, maintaining an inverted posture in that specific segment.
Economic indicators were mixed; notably, new job growth came in at a lower-than-expected 64,000, adding a layer of caution to the outlook.
The broader yield curve for terms of two years and longer continues to hold its positive slope, even as benchmark rates experienced slight downward pressure this week.
With the final major data points for the year now in the rear-view mirror, investors are looking toward the next cycle. The market will remain attentive to the upcoming jobs report on January 9th and CPI data on January 13th, as these will be critical inputs for the next Federal Reserve meeting on January 28th.