Treasuries Rise on Weaker-than-Estimated Retail Sales (Jan 03, 2026)

U.S. Treasuries rose sharply on January 3, 2026, as weaker-than-expected retail sales for December dragged on investor sentiment. The Fed Funds futures indicated a 73% probability of a rate hike in February, up from 65% at the close of the prior trading session. The 10-year Treasury yield fell to 3.92%, the lowest in 11 weeks, while the two-year yield touched 4.65%, reflecting increased demand for safe-haven assets. The National Retail Federation revised December sales down by 0.3% from the nonseasonal reading, below economists’ median forecast of 0.2% growth.