U.S. Treasury yields were flat on Wednesday morning, ahead of a policy decision from the Federal Reserve’s January meeting.
The yield on the benchmark 10-year Treasury note made little movement, trading at 1.7851% at 3:30 a.m. ET. The yield on the 30-year Treasury bond also struggled for direction and stood at 2.1309%. Yields move inversely to prices and 1 basis point is equal to 0.01%.
The Fed’s two-day January meeting will wrap up on Wednesday afternoon, with a policy decision announcement scheduled to be released at 2 p.m. ET.
The Fed is not expected to announce any policy changes on Wednesday. However, it is anticipated that the central bank will signal that it will be ready to raise interest rates as soon as March, and that it will consider other tightening measures.
Ian Shepherdson, chief economist at Pantheon Macroeconomics, told CNBC’s “Squawk Box Europe” that he also didn’t expect the Fed to make any major policy moves on Wednesday.
“Monetary policy can’t do anything about inflation today, it can’t do anything about inflation in the next 6 months,” Shepherdson explained.
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“It looks ahead 12-18 months before it takes full effect and by that point, I am reasonably confident — I stress no more than reasonably — that inflation will be heading back towards the target,” he added.
In terms of data releases, December’s international trade numbers are due out at 8:30 a.m. ET on Wednesday.
Retail and wholesale inventories data for December is also set to be released at 8:30 a.m. ET.
The number of new homes sold in the U.S. during December is then due to come out at 10 a.m. ET.
Auctions are slated to be held on Wednesday for $40 billion of 119-day bills and $26 billion of two-year floating-rate notes.
— CNBC’s Patti Domm contributed to this market report.