US Treasury yields slip ahead of jobs report

Bond traders at CME Group
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U.S. sovereign bond prices gained on Thursday, weighing on yields, as investors digested the slew of economic data this week and looked to the closely followed jobs report on Friday.

The U.S. 10-year Treasury yield, which moves inversely to the bond's price, edged lower to 1.8311 percent, after closing at 1.848 percent on Monday. This is down from 2.3 percent at the start of the year, as safe-haven buying has weighed on yields.

Meanwhile, the longer-dated 30-year yield dipped to 2.6553 percent after finishing at 2.692 percent in the previous session.

The moves came as major U.S. stock averages and oil prices both struggled for gains.

US 10-YR
US 30-YR

Investors had sold safe-haven Treasurys after solid data releases on Wednesday. Indicators included the ADP employment report, which suggested solid job growth, and the Fed's Beige Book, which indicated regional economic conditions in the U.S. had expanded.

On Thursday, the data dump continued with the ISM non-manufacturing survey February reading coming in just above expectations at 53.4. It had been 55.8 the month earlier and in January a big part of the decline was in business activity.

Other data released Thursday included U.S. jobless claims, which came in higher than expected at 278,000, as well as U.S. productivity, which fell less than expected. Factory orders, meanwhile, rose 1.6 percent percent in January.

The big report to watch, however, is the February employment report Friday morning, and it's expected to show 190,000 jobs and an unemployment rate of 4.9 percent, according to Thomson Reuters.

"Our econometric model points to a 180,000 gain in non-farm payrolls in February. We expect the unemployment rate to remain unchanged at 4.9 percent, with the growth rate of average hourly earnings edging back up to 2.6 percent," said U.S. economist at Capital Economics, Steve Murphy.