U.S. Treasury prices jumped on Wednesday, rising sharply for a second day on disappointing U.S. economic data that aggravated widening worries about a global slowdown.
Prices of 30-year Treasurys rose more than 4 points and were yielding 2.74 percent, a level last seen during May 2013.
Yields on benchmark 10-year Treasury notes – used to calculate mortgage rates and other consumer loans – fell to 1.8 percent on Wednesday morning before bouncing back to 2 percent later on—down from Tuesday's close of 2.206 percent.
"There was a trifecta of weak data this morning: several disappointments in sales, manufacturing and prices," said Kim Rupert, managing director of Action Economics in San Francisco. "That's just adding to the fear of a global slowdown. And then the price action is being exacerbated by the Ebola fears."
Yields rose sharply in early New York trading after as a batch of weaker-than-expected economic data exacerbated concerns about the state of the recovery.
Prices received by U.S. producers fell in September for the first time in over a year, a potentially worrisome sign for the economy. Meanwhile, retail sales declined in September even when factoring out weakness at auto dealers and gasoline stations, providing a surprisingly cautionary sign for the strength of consumer demand.
Despite the modest market recovery in the U.S. on Tuesday, economic data from China, Germany and euro zone on Tuesday have added to concerns over a faltering global economic recovery.
However, bellwether Federal Reserve policymaker John Williams downplayed concerns about weakness in the global economy on Tuesday, saying the U.S. central bank should only delay an interest rate hike next year if inflation or wages fail to perk up.
In an interview with Reuters, the president of the San Francisco Fed said he currently expects rates to rise in mid-2015. If the outlook changes "significantly," with inflation showing little sign of returning to the central bank's 2 percent target, he said he would even be open to another round of asset purchases.
—Reuters contributed to this report.