Skip to content
Subscriber Only

Treasury Yield Gap Shrinks Most in 19 Months After Fed Decision

The yield difference between Treasury five- and 30-year securities narrowed this week by the most in 19 months as traders unwound bets the Federal Reserve would wait until 2014 to announce cuts to its bond buying.

Yields on five- and seven-year notes rose to the highest since September after the Fed said Dec. 18 it will start slowing purchases next month. The U.S. economy grew more in the third quarter than first reported, data showed, underscoring wagers the Fed may conclude its buying next year and fueling concern it may not be able to hold interest rates at almost zero. Inflation stayed low last month, a report next week may show.