The benchmark 10-year Treasury note yield fell again on Friday as data released this week pointed to easing inflation.

The 10-year Treasury yield was trading around 4.209%, down about 3 basis points. The 2-year Treasury note yield was marginally higher at 4.694%.

Yields and prices move in opposite directions and one basis point is equivalent to 0.01%.

The moves come after the producer price index, a measure of inflation at the wholesale level, slipped 0.2% in May, lower than economists’ expectations of a 0.1% uptick and a 0.5% rise in April. The data was released Thursday.

“Both the headline and core US PPI inflation were significantly lower than expected, strengthening the view that inflationary pressures have finally started to ease,” Rabobank researchers said in a note Friday.

The figures added to other data releases this week, with weekly initial jobless claims hitting a 10-month high, and consumer prices coming in flat for May — 0.1 percentage point below expectations.

Deutsche Bank analysts said Friday that, taken together, the data had led investors to grow more confident about the prospect of interest rate cuts by the U.S. Federal Reserve.

“Given those data releases, investors dialed up the prospects of rate cuts from the Fed, and the amount priced in by the December meeting was up +6.2bps on the day to 50bps,” the analysts, led by Henry Allen, said in a note. “In turn, that led to a fresh rally for US Treasuries [on Thursday], which got another boost from a strong 30yr auction later in the session that saw the highest bid-to-cover ratio in 12 months.”

The Fed on Wednesday opted to hold rates steady at 5.25% to 5.50% and indicated that there would be just one cut this year.

— Jeff Cox contributed to this report.

Correction: A previous version misstated the magnitude of a decline in the 10-year Treasury note yield.

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