As investors evaluate the interest rate forecast, the 2-year Treasury yield descends.

On Friday, U.S. Treasury yields were lower due to investors' contemplation of the future path of interest rates while processing the most recent economic data.

The yield on the decreased by 3 basis points to 3.649%, while it was previously 3.591%.

An inverse relationship exists between yields and prices, with one basis point equivalent to 0.01%.

The Federal Reserve meeting next week is anticipated to see interest rates being cut, with traders predicting a 59% chance of a 12-basis-point reduction and a 41% probability of a 50-basis-point cut, according to CME Group's FedWatch tool.

The Fed's meeting will commence on Tuesday and end on Wednesday, featuring an interest rate decision, a post-meeting press conference, and the release of the central bank's latest economic projections.

Earlier this week, two important data sets were released: the consumer price index and the producer price index. Both of these indices indicated that inflationary pressures are decreasing, which supports the argument for a rate cut.

On Wednesday, it was revealed that headline CPI increased by 0.2% in August, as anticipated, while the core figure came in at 0.3% on a monthly basis, slightly above the 0.2% forecast. On Thursday, the PPI for August showed that wholesale prices rose 0.2% in the month, in line with expectations.

On Thursday, the number of initial jobless claims exceeded the forecasted 225,000, with a total of 230,000 claims being filed.

On Friday, investors will closely monitor import and export price data and new consumer sentiment insights.