The yield on the 10-year US Treasury inched up to 4.127% on the last day of 2025, but remained near its lowest level in more than three weeks, as investors continued to assess the Federal Reserve’s interest rate path. Minutes from the Fed’s December meeting revealed a deeply divided committee, with officials debating whether to prioritize supporting the labor market or focus on curbing persistently high inflation. Still, most policymakers saw further rate cuts as appropriate if inflation continues to ease as expected. Earlier this month, the Fed cut rates by 25bps to a 3.5%–3.75% range, the third reduction this year, although the decision drew the most dissent since 2019. Market participants are also watching the appointment of the next Fed chair early next year, which could influence the trajectory of monetary policy. The 10-year yield has fallen nearly 45 basis points this year.