Summary

• The yield curve shifted higher from the fourth quarter of 2025 to the first quarter 2026, led by increases in short- and intermediate-maturity Treasury yields.
• Economic data during the quarter reflected steady consumer activity and firm labor market conditions.
• Agency mortgage-backed securities (MBS) delivered positive excess returns for the quarter.

Key takeaways

1 Yields shifted higher

The yield curve shifted higher from the fourth quarter of 2025 to the first quarter 2026, led by increases in short- and intermediate-maturity Treasury yields. Yields at the long end rose