Bond yields reversed gears on Friday, ahead of key data on inflation.
What’s happening
-
The yield on the 2-year Treasury
TMUBMUSD02Y,
4.874%
was 4.87%, down 6.2 basis points. Yields move in the opposite direction to prices. -
The yield on the 10-year Treasury
TMUBMUSD10Y,
3.965%
was 3.98%, down 2.6 basis points. -
The yield on the 30-year Treasury
TMUBMUSD30Y,
4.022%
was 4.03%, down 1.4 basis points.
What’s driving markets
Thursday had seen a big upward move in yields, reflecting strong U.S. economic report, a leak from the Bank of Japan that its yield control program would be modified, and a poorly received auction in 7-year notes.
The 16 basis point rise for the 10-year was the most since Sept. 26, 2022.
Friday will see two major releases on inflation: the PCE price index, which is the Fed’s preferred measure of inflation, as well as the quarterly employment cost index, a crucial measure of wages. Both are due at 8:30 a.m. Eastern.
Expectations are that the core PCE price index will rise 0.2% on a monthly basis, and that the employment cost index will climb 1.1%.
This post was originally published on Market Watch
