Treasury notes (T-notes)<\/strong> earn a fixed rate of interest every six months and are issued in maturities of two, three, five, seven, and 10 years. The 10-year Treasury note is often referenced regarding the performance of the bond market and is also used as a benchmark by the mortgage market.<\/p>\n Treasury bonds (T-bonds)<\/strong> are similar to T-notes but have a maturity of 20 or 30 years. Like the T-note, they provide an interest payment every six months.<\/p>\n Yields on short-term Treasuries, up to the one-year bill, generally follow the federal funds rate. Until the rapid increase in the funds rate that began in 2022, longer-term Treasuries offered higher yields, because investors typically demand a higher premium for tying up their cash for a longer period. Now that the funds rate has begun to decline, Treasury yields may move toward this more typical pattern.<\/p>\n Treasury inflation-protected securities (TIPS)<\/strong> are inflation-indexed bonds with the principal adjusted by changes in the Consumer Price Index (CPI). If the CPI rises, the principal value of TIPS increases, which can be a helpful hedge against inflation. TIPS are issued in maturities of five, 10, and 30 years. (Unless you own TIPS in a tax-deferred account, you must pay federal income tax on the income plus any increase in principal, even though you won\u2019t receive any accrued principal until the bond matures.)<\/p>\n Treasury floating-rate notes (FRNs)<\/strong> are issued with a two-year maturity and an interest rate that is adjusted weekly, based on the most recent discount rate for 13-week T-bills. However, interest payments are made quarterly.<\/p>\n U.S. Treasury securities are guaranteed by the federal government as to the timely payment of principal and interest. The principal value of Treasury securities fluctuates with market conditions. If not held to maturity, they could be worth more or less than the original amount paid.<\/em><\/p>\n This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek guidance from an independent tax or legal professional. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. \u00a9 2024 Broadridge Financial Solutions, Inc.<\/p>\n","protected":false},"featured_media":1380,"template":"","meta":{"_acf_changed":false},"newsletter-category":[32],"class_list":["post-1379","newsletter","type-newsletter","status-publish","has-post-thumbnail","hentry","newsletter-category-november"],"acf":[],"yoast_head":"\n
\nFollowing the Fed<\/h2>\n
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