Treasury Yield

Definition

The annualized return implied by the market price and payments of a U.S. Treasury security. Yields vary by maturity and move as prices change.

Treasury yields are quoted for maturities ranging from short-term bills to long-term bonds. For a security with fixed payments, buying at a lower price generally means earning a higher yield. Investors use Treasury yields as reference points for pricing other debt.

Example

A one-year U.S. Treasury bill costs $960 and pays $1,000 at maturity. Holding it to maturity earns about 4.17% on the $960 paid.