CME Group

10-Year T-Note Futures Declined After Hawkish Fed Minutes. 2/18/26

The market focus on February 18 was the decline in 10‑year Treasury note futures after the Federal Reserve released its minutes. Futures slipped for a second straight session, retreating from a two‑and‑a‑half‑month high and trading around the 112.29 level. Two catalysts drove the sell‑off: industrial production numbers that beat expectations and Fed minutes that painted a decidedly hawkish outlook. The minutes noted that several officials would stay aggressive if inflation remains above target, reinforcing expectations of tighter monetary policy. The 10‑year yield rose roughly four basis points to 4.09%, while the yield curve steepened as back‑end rates climbed 3.5‑4 bps versus 2‑2.5 bps at the front end. The Fed’s tone and stronger data together pushed yields higher across the board. Higher yields raise borrowing costs for corporations and consumers, signal that rate hikes may continue, and force bond investors to reassess duration risk. The steepening curve also hints at a widening spread between short‑ and long‑term financing, shaping portfolio strategies moving forward.