US Treasury yields dip as AI concerns and bond auction shape trading

US Treasury yields edged lower on Wednesday as investors weighed how higher borrowing costs could affect AI-related companies.

When concerns about those companies weigh on stocks, investors have sometimes shifted money into Treasuries, which are seen as safer assets.

The 10-year yield was 5.111%, down slightly and on course for a second straight daily decline.

A $13 billion auction of 20-year bonds drew above-average demand, but the yield offered was higher than expected, and Treasury yields rose from their daily lows afterward.

Despite hotter-than-expected inflation readings, markets put the chance of a quarter-point Federal Reserve rate hike on October 28 at 14.9%, down from 33.2% a week earlier.

The Fed decision is due next week, while the Treasury plans to auction $26 billion in inflation-protected five-year bonds on Thursday.