10-year Treasury yield falls to 5.24%, two-year drops to 4.79%

Yields pulled back from a selloff that had pushed the 10-year above 5.2%, with the two-year's sharper fall pointing to a shift in timing rather than in the Fed's inflation stance.

The two-year yield fell 10 basis points to 4.79%.

Jobless claims fell to their lowest level since July, adding to signs the labour market remains steady even as rates have climbed. Gold tracked the retreat in yields, with the SPDR Gold Trust (GLD) rising 0.55% to $382.94, as haven demand was reinforced by fiscal troubles in France.

The pullback follows a shift that began on September 29, when New York Fed President John Williams said the central bank was in no rush to raise rates again, a remark that first prompted traders to cut the odds of an October increase to 50-50 from 70%. Fed Vice Chair Philip Jefferson has since echoed that stance, saying the Fed will let incoming data drive its next move. Other officials have not matched that tone: Lorie Logan has pointed to strengthening growth and a balanced labour market, and Barkin, Collins and Schmid have declined to commit either way, even as traders already price the October decision as a toss-up.

With Jefferson and Williams both now signaling patience, the data on inflation and jobs due before the Fed's next meeting will likely matter more than further comments from officials in deciding whether yields keep falling or resume climbing. The two-year yield's steeper drop compared with the 10-year suggests markets are treating this as a near-term timing question rather than any change in the Fed's broader stance on inflation, since hawkish voices have kept pressing their case through the same stretch.