The two-year yield fell twice as far as the 10-year, which touched its highest since 2002

The two-year Treasury yield fell twice as far as the 10-year on Thursday. The 10-year rose as high as 5.34%, the highest since 2002, and closed at 5.24%, 5 basis points below Wednesday. The two-year, which moves with expectations for the Fed's next steps, fell 10 basis points, to 4.78%, while the fund that holds the S&P 500, ASPY, closed 0.18% higher.

A Fed that says there is no rush fits the two-year's drop. The same words fit a 10-year yield that closed above 5% much less well.

"With the policy action we took at our September meeting, there is no need for urgency," New York Fed President John Williams said Tuesday.

September's meeting raised the Fed's target range for its main interest rate by a quarter-point, to 3.75% to 4%. One further increase may still be appropriate late this year, he said, if the economy follows his forecast.

Federal Reserve Vice Chair Philip Jefferson spoke Thursday at the University of Virginia. Inflation is too high, he said, and has been above the Fed's 2% target for more than five years. Higher yields since that meeting, he said, are a sign that investors are reassessing the economic outlook.

"My colleagues and I will need to come to our own judgment, which may take more time," he said.

He said any future change should be judged from the data, the outlook and the balance of risks. Analysts at Evercore ISI said the speeches mean the Fed does not expect another increase at this month's meeting.

The long end fell much less. The 30-year yield dropped 3 basis points, to 5.61%, but the fund of Treasurys maturing in more than 20 years, ATLT, still closed down 0.1% after trading just above its low for the past year.

BHYG, a fund of riskier corporate bonds, traded at its lowest price in the past year and closed down 0.4%.

In late trading, Brent crude was up 4.4% at $102.35 and WTI crude was up 2.8% at $92.92. The reported reasons were Chinese refiners suspending fuel exports beyond Hong Kong and Macau, and a US official saying the military is moving roughly 9,000 troops to the Middle East on ships that include a third aircraft carrier. President Trump has said further strikes on Iran after the midterm elections are possible.

The September jobs report is due Friday. Wall Street expects 84,000 new jobs and an unemployment rate of 4.1%, after a gain of 162,000 in August. At 4.78%, the two-year yield is still 78 basis points above 4%, the top of the Fed's range, and Friday's report is the next test of that gap.