US Treasury yields hold higher after Fed minutes

Bond traders at CME Group
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U.S. government debt prices were mostly lower on Wednesday as investors keep an eye on President-elect Donald Trump's policy agenda and digested a slew of economic data and minutes from the Federal Reserve's Nov. 1-2 meeting.

The minutes back the consensus view on Wall Street that the Fed is poised to raise rates in December

The yield on the benchmark 10-year Treasury notes, which moves inversely to price, was higher at around 2.35 percent, while the yield on the 30-year Treasury bond was also higher at 3.02 percent. The two-year note yield, meanwhile, hit its highest level since April 2010 and was last trading near 1.14 percent.

But earlier, Treasury yields fell slightly after the Treasury Department auctioned $28 billion in seven-year notes at a high yield of 2.215 percent.

The bid-to-cover ratio, an indicator of demand, was 2.68, above a recent average of 2.5.

Indirect bidders, which include major central banks, were awarded 72.7 percent, well above a recent average of 62 percent. Direct bidders, which include domestic money managers, bought 9.4 percent, below a recent average of 13 percent.

The yield on the seven-year Treasury note dipped to about 2.16 percent, having traded near 2.22 percent before the sale.


Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
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US 2-YR
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US 5-YR
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US 10-YR
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US 30-YR
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Weekly jobless claims increased 18,000 to a seasonally adjusted 251,000 for the week ended Nov. 19, the Labor Department said on Wednesday. That said, claims have now been below 300,000, a threshold associated with a healthy labor market, for 90 straight weeks.

Other data released Wednesday included the IHS Markit manufacturing index for November, which showed a slight increase to 53.9 from 53.4 in October. A reading above 50 signals expansion within the sector. "The headline index was the highest since October 2015, largely reflecting robust output and new business growth during the latest survey period," IHS said.

New home sales for October fell 1.9 percent , while consumer sentiment came in at 93.8, above a 91.6 estimate.

In oil markets, U.S. crude settled down 7 cents at $47.96 a barrel.

OPEC will debate an oil output cut of more than 1 million barrels a day for all of its members except Libya and Nigeria next week but the deal appears to hinge on Iraq and Iran's approval, according to Reuters.