U.S. Treasury yields rose on Friday as investors digested the previous day’s data release, which showed jobless claims fell slightly, below expectations.
The return of the benchmark index 10-year Treasury bond was up 4 basis points at 2.926% as of 8:30 a.m. ET, while the yield on the 30-year Treasury bond was trading down about 3 basis points at 3.1728%. Yields move inversely to prices and one basis point is equal to 0.01%.
The yield on the 2-year short-term Treasury also traded around 2 basis points higher at 3.255%.
The rise in yields was a change from the previous session, which saw yields cool as markets reflected on the minutes of the Federal Reserve’s July meeting. The Fed has signaled that it will continue raising rates until inflation slows significantly, although the central bank may soon ease its pace of tightening.
Thursday also revealed a further slowdown in housing demand, with home sales fall almost 6% in July as the housing market enters a contraction.
Unemployment claims were at 250,000 for the week ending August 13, down 2,000 from the previous week and below the Dow Jones estimate of 260,000.
Markets and monetary policymakers are watching the labor market closely as rate hikes aim to cool a 40-year high labor market and inflation. Fed policymakers said reducing inflation was the top priority, even if it meant fewer hirings, according to minutes released Wednesday.
The Fed is considering another big rate hike in September, St. Louis Fed Chairman James Bullard said Thursday, adding he can’t say with certainty that inflation has peaked.
“We should continue to move quickly to a policy rate level that will put significant downward pressure on inflation…I don’t really see why you want to extend interest rate hikes into next year,” he said. Bullard. said in an interview with the Wall Street Journal.
Releases of data on oil rig counts conducted by Baker Hughes are due Friday.
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