North Korean leader Kim Jong Un promised on Friday to make a "mentally deranged" Donald Trump pay dearly for his threats, after the US president vowed to destroy the country.

The threat halted a bond selloff sparked by the Federal Reserve taking a more hawkish tone than investors had expected at its September meeting, which concluded on Wednesday.

"There's much less selling in advance of the weekend," said Jim Vogel, an interest rate strategist at FTN Financial in Memphis, Tennessee. "This has the initial appearance of not going home with any particular rate views when North Korea and the White House are in a bigger spat than they have been."

Benchmark 10-year notes

gained 9/32 in price to yield 2.25 percent, down from 2.28 percent on Thursday.

The US Treasury yield curve flattened to its lowest levels since late 2007 overnight, before retracing in the US session, as traders prepared for the likelihood that the US central bank will raise rates in December.

New economic projections released after the Fed's meeting showed 11 of 16 officials see the "appropriate" level for the federal funds rate, the central bank's benchmark interest rate, to be in a range between 1.25 percent and 1.50 percent by the end of 2017, one-quarter of a point above the current level.

That view comes despite still-sluggish inflation that many investors have viewed as likely to crimp the Fed's ability to tighten monetary conditions.

"There is not a lot of faith that yields can be sustainably higher," said Aaron Kohli, an interest rate strategist at BMO Capital Markets in New York.

Intermediate-dated debt is highly sensitive to interest rate increases, while longer-dated bonds are influenced by inflation expectations.

"The problem comes from the long-term implications of their moves _ what does that say about growth and inflation in the long run? The market's not very optimistic about that," Kohli said.

The yield curve between five-year notes and 30-year bonds flattened to 91.1 basis points, the lowest level since late 2007, before steepening back to 92.3 basis points.