Treasury yields edge higher, with 10-year taking aim at 1.30%


U.S. Treasury yields rose Friday, with the 10-year taking another run at the 1.30% level after pulling back in the previous session following data that showed a drop in first-time jobless benefit claims.

What are yields doing?
  • The yield on the 10-year Treasury note
    TMUBMUSD10Y,
    1.299%
    traded at 1.292% versus a level of 1.264% Thursday afternoon. Yields and debt prices move in opposite directions.

  • The 2-year note yield
    TMUBMUSD02Y,
    0.202%
    fell to 0.194% compared with 0.2% on Thursday.

  • The yield on the 30-year Treasury bond
    TMUBMUSD30Y,
    1.942%
    rose to 1.932%, compared with 1.90%.

What’s driving the market?

A rebound in Treasury prices after data showed an unexpected rise in jobless claims last week saw yields retreat on Thursday, but yields have bounced significantly after the 10-year rate dipped to a five-month low to begin the week as investors dumped equities and other assets viewed as risky and snapped up Treasurys.

Analysts said next week’s meeting of Federal Reserve policy makers will take center stage, with investors eager for further guidance on the timing of an eventual tapering of the central bank’s asset purchases and the subsequent liftoff of interest rates.

A light day for U.S. economic data will see the IHS Markit purchasing managers index readings for the manufacturing and services sectors released at 9:45 a.m. Eastern.

What are analysts saying?

A slow session for global bond markets overnight likely points to a similar session for the U.S. market, said Jim Vogel, executive vice president at FHN Financial, in a note.

“Next week’s interest rate agenda is too long and too varied to leave strong opinions in place over the weekend,” he said, while noting that the Markit PMI readings “can be tricky, though, because soft, diffusion indexes are difficult to forecast accurately and are rarely intuitive when it comes to high-speed trading strategies.”



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