Summary

• The Bloomberg U.S. 1–3 Year Government Bond Index returned 0.27% in the first quarter of 2026.
• Front-end U.S. Treasury yields rose as the conflict in Iran dominated the headlines.
• The 2s/5s curve flattened over the quarter by 11 basis points (bps; 100 bps equal 1.00%) and ended at 14 bps.
• 2-year U.S. Treasury yields rose by 32 bps to end the period at 3.79%, up from 3.47% where they ended last quarter.
• The 2s/10s curve flattened by 17 bps to 52 bps, from 69 bps where it ended the year.

Market review

March saw extreme shifts in Federal Reserve (Fed) expectations, leading to a period of higher interest rates and elevated volatility. Higher rates are challenging for borrowers and yet are better for investors looking to deploy new

45 Followers