Report published August 31, 2026

Raymond James Fixed Income Weekly Primer: Yield Curve Dynamics and Policy Divergence (August 31, 2026)

Raymond James · August 31, 2026

Persistent PCE inflation keeps Fed Chair Kevin Warsh focused on price stability rather than growth, even as Treasury debt buybacks push in the opposite direction. Across fixed income, the Treasury curve flattened, investment-grade corporate bonds achieved 1-year total return highs, and steep municipal curves continue to offer attractive long-end income.

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Key Takeaways

1.Inflation persists above expectations per recent PCE data, establishing it as Fed Chair Kevin Warsh's central priority without forward guidance, while Treasury debt buybacks by Scott Bessent conflict with monetary policy goals.
2.The U.S. Treasury curve flattened over the week, with front-end 1- and 2-year yields rising 11-12 bps while 10- and 30-year yields fell.
3.Corporate investment-grade bonds reached their highest 1-year total return, while steep municipal yield curves continue to present income opportunities at the longer end.

Fixed Income Solutions

Report data

Fixed Income Weekly Rates Summary — as of August 31, 2026.

Metric	Estimate	Context
10-Year Treasury Yield	4.73%	Treasury yield table as of 08/31/26
30-Year Treasury Yield	5.22%	Treasury yield table as of 08/31/26
1-Year Treasury Yield	4.15%	Treasury yield table as of 08/31/26
5-Year Treasury Yield	4.48%	Treasury yield table as of 08/31/26
S&P 500 Index Level	7711.76 points	Weekly equity index price appreciation