(Bloomberg) -- The U.S. two-year Treasury yield fell to a record low not far above zero as economic data revealed more of the damage caused by measures to contain the coronavirus pandemic.
The yield declined as much as 4 basis points to 0.1388%. The previous record low, 0.1431%, had been reached in September 2011 amid concern over Europe's sovereign-debt turmoil and as the U.S. economy struggled to recover from recession.
The two-year note's yield was above 1% as recently as Feb. 28. Its decline accelerated when the Federal Reserve subsequently returned the fed funds target to almost 0% in two emergency rate cuts.
Thursday's decline was led by money-market rates, which began to price in a negative monetary policy rate next year. The price of January 2021 federal funds futures at one point topped 100, signifying traders expect the Fed to further drop the target range from 0%-0.25%.
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