U.S. Treasury yields edge up as investors digest strong employment news

U.S. Treasury yields were little changed on Friday (10th) as traders digested a surge in weekly jobless claims and the impact on interest rates.

U.S. Treasury yields were little changed on Friday (10th) as traders digested a surge in weekly jobless claims and the impact that would have on interest rates.
The 10-year U.S. Treasury yield edged up 0.2 basis points to 4.451% at 6:24 a.m. ET.
At the same time, the 2-year government bond yield edged up 0.8 basis points to 4.815%.
One basis point when yields and prices move in opposite directions is equivalent to 0.01 percentage points.
Yields came under pressure on Thursday (9th) due to strong demand for the U.S. Treasury Department\’s auction of $25 billion in 30-year bonds.
The easing of the auction results means traders are now firmly focused again on where the Fed\’s interest rates will go.
Weekly initial jobless claims reported Thursday hit 231,000, the highest level since August 2023.
The data were seen as a sign that the U.S. labor market, which has been strong so far, may be cooling and reinforced expectations that the Federal Reserve will cut interest rates this year.
Deutsche Bank strategists led by Allen noted that U.S. Treasuries outperformed the broader market on Thursday by initial jobless claims data \”leading futures to push up the likelihood of a rate cut this year.\”
\”The next key will be next week\’s U.S. April inflation data, but at least so far this month investors have begun to expect a more dovish stance on monetary policy than thought at the end of April,\” they wrote in a note.
The Bank of England kept interest rates unchanged on Thursday as expected but raised expectations for a rate cut in June.
Consumer confidence data for May will be released on Friday.
Economists expected the index to fall to 76 from 77.2.
Several Fed presidents are also scheduled to speak, including Dallas\’ Logan, Minneapolis\’ Kashkari and Chicago\’s Goolsby.
Fed Governor Bowman will also comment.

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