On Friday, U.S. Treasury yields decreased as investors analyzed the economy following the release of inflation data and pondered the future of interest rates. At 4:48 a.m. ET, the 10-year Treasury yield dropped by over three basis points to 4.5399%, while the 2-year Treasury yield was at 4.9200% after a decrease of more than four basis points. Yields and prices have an inverse relationship, with one basis point representing 0.01%.

Investors were evaluating the economy after key economic data releases, and speculating about potential monetary policy decisions from the Federal Reserve. The March producer price index, which tracks wholesale inflation, was lower than expected with a 0.2% increase from the previous month, compared to the 0.3% increase economists had predicted. This slightly eased concerns about persistent inflationary pressures. Market expectations for rate cuts have shifted from June to September after the release of the March consumer price index earlier in the week, which came in higher than expected. Some investors believe there may be no rate cuts at all this year.

The Federal Reserve has emphasized that any decisions on rate cuts will be based on data, and it is waiting for inflation to decrease before adjusting monetary policy. On Friday, investors were awaiting the release of import and export prices, as well as new consumer sentiment data for April.