Mumbai, June 29 -- The 2-year Treasury note yield moved lower on Friday as Minneapolis Federal Reserve President Neel Kashkari said he has changed his outlook and now expects that one interest rate increase will be necessary this year. Kashkari is a voting member of the Federal Reserve's policy-setting Federal Open Market Committee (FOMC). Fixed income prices were also helped as energy prices declined, lessening the expected future impact from higher oil and gasoline prices.

The 2-year Treasury note yield which closely tracks short-term Fed interest rate decisions, fell more than 3 bps to 4.08% while the yield on the 10-year Treasury- the benchmark for mortgages, auto loans and credit card debt - fell 2 bps to 4.37%. The 30-year Treasury...