One of the more noteworthy developments in the financial markets of late has been the plunge in U.S. Treasury (UST) yields. This week on the Basis Points podcast, Kevin Flanagan reviews the implications and provides some monetary policy outlook for 2024.

Basis point: 1/100th of 1 percent.

Federal funds rate: The rate that banks that are members of the Federal Reserve system charge on overnight loans to one another. The Federal Open Market Committee sets this rate. Also referred to as the “policy rate” of the U.S. Federal Reserve.

Treasury yield: The return on investment, expressed as a percentage, on the debt obligations of the U.S. government.