This week, the U.S. bond market experienced significant volatility. As of the end of the New York trading session on Friday, the yield on the 10-year U.S. Treasury bond recorded 4.3238%, up 4.08 basis points from last week. Notably, before the release of the Producer Price Index ( PPI ) data on Wednesday, the 10-year yield had briefly declined to 4.1979%.

Meanwhile, the 2-year U.S. Treasury yield showed a different trend. Despite a slight increase of 2.44 basis points to 3.7568% on Friday, it still fell by 0.55 basis points overall this week. The 2-year yield exhibited a V-shaped movement during the week, similarly touching a weekly low of 3.6513% before the release of the PPI data.

This divergence has led to an expansion of the yield spread between the 2-year and 10-year U.S. Treasury yields. As of Friday, the spread has widened to 56.485 basis points, an increase of 4.429 basis points for the week.

This data reflects a divergence in the market's views on economic prospects and inflation expectations. The rise in long-term bond yields may suggest that investors are more optimistic about future economic growth, while the fluctuations in short-term bond yields may reflect a sensitive response to recent economic data and monetary policy. In the coming week, the market will continue to closely monitor the upcoming economic data and speeches from Federal Reserve officials for more clues about the direction of interest rates.