The treasury yield curve i.e. the difference between the 10-year treasury yield and the 2-year treasury yield narrowed to 80 basis points after the Fed maintained the outlook for three rate hikes this year.

The 10-year treasury yield fell to 2.103%; the lowest level since November 10. The 10-year yield was last seen trading around 2.14%. The 2-year yield dropped to a low of 1.29% before staging a sharp recovery to 1.34%.

The yield curve or the difference stood at 85 basis points prior to the dismal CPI release and was seen hovering around 82 basis points ahead of the Fed rate decision.

The yield curve has been flattening since the start of the year and has been accompanied by the sell-off  in the US dollar.