U.S. government debt prices eased on Thursday as investors digested the latest developments coming out of the White House.
The yield on the benchmark 10-year Treasury notes, which moves inversely to price, was higher at around 2.236 percent, while the yield on the 30-year Treasury bond was also higher at 2.910 percent.
Treasurys staged their second-biggest rally of the year Wednesday, as expectations faded that Trump can get tax reform or fiscal stimulus through Congress this year, or maybe even next year.
U.S. equities suffered their worst day of the year Wednesday, with the Dow dropping 372 points, on the back of news that former FBI Director James Comey put together a memo outlining a conversation in which Trump allegedly asked him to halt an investigation into former National Security adviser Michael Flynn.
The risk going forward is that this thing goes on and on and we dont have a resolution, which means the new administration is not able to work on its tax initiatives and regulatory reform, said Subadra Rajappa, head of U.S. rates strategy at Societe Generale in New York.
Treasurys
In economic news, weekly jobless claims totaled 232,000, below the expected 240,000. Meanwhile, the Philadelphia Federal Reserve business index rose to 38.8 in May from 22.0 in April.
—CNBC's Patti Domm, Fred Imbert and Reuters contributed to this report.