By Harshit
NEW YORK, Nov. 26, 2025
U.S. Treasury yields edged higher on Wednesday as investors assessed fresh labor market data and awaited developments regarding the Federal Reserve’s December interest rate decision. Rising speculation around who will lead the central bank next added another layer of uncertainty to the bond market heading into the final weeks of 2025.
The yield on the 10-year Treasury climbed more than 2 basis points to 4.023%, extending the upward drift seen earlier this week. The 30-year Treasury bond rose 1 basis point to 4.668%, while the 2-year Treasury—which is more sensitive to expectations for Fed policy—gained more than 3 basis points to 3.493%.
Bond yields move inversely to prices, and one basis point equals 0.01%.
U.S. Treasury Market Snapshot (Nov. 27, 2025)
| Treasury Security | Yield | Change |
|---|---|---|
| U.S. 10-Year | 4.023% | +0.021 |
| U.S. 1-Month | 3.993% | +0.027 |
| U.S. 1-Year | 3.611% | +0.021 |
| U.S. 2-Year | 3.495% | +0.036 |
| U.S. 30-Year | 4.666% | +0.008 |
| U.S. 3-Month | 3.835% | +0.007 |
| U.S. 6-Month | 3.794% | +0.021 |
Labor Market Data Shows Unexpected Strength
New government data suggested the U.S. labor market may be more resilient than previously thought. Initial jobless claims for the week ending Nov. 22 came in at 216,000, well below the 225,000 expected by economists surveyed by Dow Jones. That marks the lowest weekly total since mid-April.
The labor market’s steadiness complicates the Federal Reserve’s calculus heading into its December meeting. Although hiring has slowed in several sectors, layoffs remain historically low, giving policymakers mixed signals at a time when inflation has eased but underlying economic risks remain.
A stronger labor market typically reduces the urgency for rate cuts, but Fed officials remain divided after months of soft wage growth and declining job openings.
Focus Turns to Fed Leadership Decision
Markets were also sharply focused on new remarks from Treasury Secretary Scott Bessent, who told CNBC on Tuesday that there is “a very good chance” President Donald Trump will announce the next head of the Federal Reserve before Christmas.
Bessent—a central figure in Trump’s economic agenda—has been tasked with interviewing candidates to replace current Fed Chair Jerome Powell, whose term expires in February 2026. The Treasury secretary confirmed that only one interview remains in the selection process.
“It’s his prerogative, whether it’s before the Christmas holidays or in the new year. But I think things are moving along very well,” Bessent said.
According to Bloomberg, Trump’s advisors believe Kevin Hassett, director of the White House National Economic Council, is the frontrunner. Hassett’s views align closely with Trump’s preference for lower interest rates to stimulate economic growth.
Analysts note that the naming of a dovish chair—especially amid a slowing economy—could accelerate market expectations for rate cuts in early 2026, even as the Fed approaches its final meeting of the year.
Rate Cut Expectations Strengthen
Despite improving labor data, investors remain confident that the Fed will lower rates in December. According to the CME FedWatch Tool, markets are pricing in more than an 80% probability of a 25 basis point rate cut at next month’s meeting.
The shift comes after recent remarks by New York Fed President John Williams, who said that monetary policy is becoming “less restrictive” and that there is room for further adjustment “in the near term.” Williams’ comments helped reverse some of the sharp repricing that had occurred amid worries that the Fed might pause cuts.
Still, internal Fed divisions persist. While several officials have signaled comfort with additional easing, others warn that premature cuts could risk reigniting inflation—particularly as global energy prices remain volatile and supply chains adjust to new tariff structures.
Market Outlook
Bond analysts say Wednesday’s move in yields reflects a combination of:
- stronger-than-expected jobless claims
- renewed confidence in a December rate cut
- investor positioning ahead of the Fed chair announcement
With only days left before the November economic data backlog is fully released following the government shutdown, markets expect increased volatility, especially in short-term Treasurys.
For now, bond traders remain focused on two pivotal developments: whether the Fed signals a longer rate-cutting cycle—and who will be chosen to steer U.S. monetary policy through 2026.