U.S. Treasury yields rise as Fed holds rates steady, signals only one cut this year

The 2-year Treasury yield was also higher by 1 basis point at 4.76%. Yields and prices move in opposite directions and one basis point is equivalent to 0.01%.

The Fed on Wednesday held rates steady at 5.25%-5.50% and suggested it would lower rates just once later this year, down from three rate cuts forecast in March.

The U.S. central bank indicated slight optimism that inflation remains on track to trend back toward the Fed’s 2% goal, allowing for some policy loosening over the coming months.

“Inflation has eased over the past year but remains elevated,” the post-meeting statement said. “In recent months, there has been modest further progress toward the Committee’s 2 percent inflation objective.”

On the data front, initial jobless claims for the week ending June 8 will be released alongside the producer price index for May at 8:30 a.m. ET.

— Jeff Cox contributed to this report.