2-Year U.S. Treasury Yield Hits 4.20%, Highest in 12 Months

On June 17, 2026, the 2-year U.S. Treasury yield reached 4.20%, its highest level in 12 months. That same day, the Federal Open Market Committee left the federal funds target range unchanged at 3.50% to 3.75% and said inflation remained elevated while economic activity was expanding at a solid pace despite elevated uncertainty tied in part to the conflict in the Middle East. Economic projections released with the meeting showed the median 2026 PCE inflation estimate rising to 3.6% from 2.7% in the March projections, while the median year-end 2026 federal funds rate projection moved to 3.8% from 3.4% in March.

On June 18, the U.S. Treasury announced a new $69 billion 2-year note for auction on June 23 and settlement on June 30. The announcement said $142.819 billion of coupon securities held by the public and $30.986 billion held in the System Open Market Account would mature on June 30, the same date as settlement for the new 2-year note. Treasury also announced a new $70 billion 5-year note for auction on June 24 and settlement on June 30, and its late-June schedule listed a 2-year floating-rate note reopening for June 24 and a 7-year note auction for June 25, both also settling on June 30.