By Akane Otani 

U.S. Treasury prices rose Wednesday as investors awaited the conclusion of the Federal Reserve's latest two-day policy meeting.

The yield on the benchmark 10-year U.S. Treasury note was recently at 3.083%, compared with 3.102% Tuesday.

The 10-year yield, which falls as bond prices rise, finished Tuesday at its second-highest level of the year, driven higher by anticipation of potentially hawkish messaging from the Fed and renewed optimism about the global economy.

Bond traders say they have largely priced in the Fed raising short-term interest rates by a quarter-percentage point. What they will be closely watching for is the central bank's expected rate path beyond 2018.

The Fed's so-called dot plot, which shows committee members' projections for interest rates in the future, is set to show forecasts for 2021 for the first time. Bond investors and analysts will be parsing it and Fed Chairman Jerome Powell's news conference for signs that the Fed might accelerate its pace of interest-rate increases -- something that could put fresh pressure on Treasurys.

"We easily see the Fed continuing the hiking cycle into 2020 before it likely comes to an end that year," said RBC Capital Markets in a note.

Mr. Powell may also field further questions about tariffs, which some analysts have worried could dampen growth and eventually warrant a more gradual pace of rate increases.

"He is likely to throw shade on the notion that tariffs are a significant downside risk," RBC Capital Markets analysts said.

Write to Akane Otani at akane.otani@wsj.com

(END) Dow Jones Newswires

September 26, 2018 10:53 ET (14:53 GMT)

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