Thursday saw a modest uptick in the 2-year Treasury yield as investors deliberated the future trajectory of interest rates amidst recent comments from Federal Reserve officials and impending economic indicators. Closing at 4.61%, the 2-year Treasury yield edged up by 4 basis points, while the 10-year Treasury yield remained steady at 4.20%. Investors grappled with the uncertainty surrounding potential interest rate cuts this year, with traders currently pricing in a 60% chance of cuts in June, according to CME Group’s FedWatch Tool.

Federal Reserve Governor Christopher Waller emphasized on Wednesday that there was no urgency to lower interest rates, citing recent economic data indicating a need for prolonged rate elevation to ensure sustainable inflation. Waller's stance underscores the Fed's cautious approach in light of evolving economic conditions. Meanwhile, Thursday saw the release of the latest weekly jobless claims, slightly below economists' expectations. Looking ahead, investors await the release of fresh inflation data on Friday, even as markets close for Good Friday. The personal consumption expenditures price index, the Fed’s preferred gauge of inflation, is poised to provide insights into the future direction of monetary policy.