Interest rates fell in the Treasury market Wednesday as a weaker economic forecast from the Federal Reserve boosted buying of safe-haven assets.
The Fed said it expects the economy to grow between 3 and 3.5 percent this year. That's down from the 3.2 percent to 3.7 percent forecast in April.
The central bank also gave a slightly less upbeat employment forecast. The Fed said it expects the unemployment rate, now at 9.5 percent, to bottom out at 9.2 percent this year. In April, it predicted that unemployment would fall to 9.1 percent.
Investors reacted by shifting money into safer-assets like Treasurys, driving interest rates lower. The yield on the benchmark 10-year Treasury note fell to 3.05 percent from 3.13 percent late Tuesday. Its price rose 62.5 cents to $103.781.
The 10-year yield helps set interest rates on mortgages and other consumer loans. It recently dropped below 3 percent for the first time since April 2009.
Investors have been moving money into Treasurys since major stock indexes began to fall from their 2010 highs in late April. Economic reports in the past two months have brought fears that the recovery could stall.
In other trading, the yield on the two-year Treasury note fell to 0.61 percent from 0.68 percent. Its price rose 12.5 cents to $100.031.
The 30-year bond yield fell to 4.03 percent from 4.11 percent. Its price rose $1.375 to $105.906.
The yield on the three-month Treasury bill stayed at 0.14 percent. Its discount rate stood at 0.15 percent.
© Copyright 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.