TREASURIES-US yields largely unchanged in final week of 2025

By Matt Tracy

Dec 30 (Reuters) - Treasury yields were largely unchanged at midday on Tuesday, as the market looked ahead to January for signs of the U.S. economy's direction.

The yield on 10-year ?Treasury notes ticked up 0.2 basis points (bp) from Monday's close to 4.118%.

The yield on ?the 30-year Treasury bond was last unchanged at 4.803%.

The two-year U.S. Treasury ?yield, which typically moves in step with interest ?rate expectations, was ?last down 1.7 bps at 3.448%.

The U.S. dollar five-year forward inflation-linked swap , seen by some ?as a better gauge of inflation expectations ?due to possible distortions caused by the Fed's quantitative easing, was last at 2.445%.

Yields were largely unchanged after ?Tuesday data showing that home prices ?in October ?rose at the slowest annual rate in more than 13 years.

Data on Monday showed pending home sales rose 3.3% last month after ?an upwardly revised 2.4% gain in October, the NAR said. Economists polled by Reuters had forecast contracts rising 1%.

A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an indicator of economic expectations, ?was ?at 67 bps.

Market odds of a cut in a key interest rate at the Federal Reserve's January meeting were last ?at 16.1%.

Market participants are watching closely for any key data points that could point to a rate cut in January. This will likely come in the first month of the New Year with the next major inflation and jobs reports, market participants said.

"There has not been a lame-duck midterm ?year (like 2026) since 1950 in which sustained monetary tightening coincided with a favorable market outcome," said Dean Lyulkin, CEO of small business lender Cardiff and founder of The Dean's List, ?in a written note.

(Reporting by Matt Tracy in Washington; Editing by Susan Fenton)