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US Treasury yields mixed as investors digest fresh economic data

  • On the data front, investors pored over the weekly report on initial jobless claims and the monthly report on inflation.
  • Robust second-quarter demand has buoyed oil markets, which have been struggling to rebalance as a supply glut has weighed heavily on prices, the IEA said in its September report released Wednesday.

U.S. government debt yields were mixed on Thursday as investors pored over the latest batch of economic data.

The yield on the benchmark 10-year Treasury notes, which moves inversely to price, rose to 2.195 percent, while the yield on the 30-year Treasury bond fell to 2.774 percent.

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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The Labor Department said on Thursday its Consumer Price index rose 0.4 percent last month, driven by a swell in gasoline prices. August's gain is the largest in seven months and lifted the year-on-year increase in the CPI to 1.9 percent, according to Reuters.

So-called core CPI, which removes the volatile food and energy components, increased 1.7 percent.

US 10-year Treasury note yield intraday chart

Source: FactSet

On Wednesday the Department said its producer price index for final demand increased 0.2 percent last month. The core PPI, which also excludes food, energy and trade services, increased 1.9 percent in the last year through August.

Investors are scrutinizing all metrics of inflation for any hint on the timing of the next interest rate increase from the Federal Reserve. Following the release of strong numbers in both indexes from the Labor Department, the CME Group's FedWatch tool revealed a sharp uptick in the likelihood of a December rate hike, now above 50 percent.

In other data news from the Labor Department, initial claims for state unemployment benefits declined 14,000 to a seasonally adjusted 284,000 for the week which ended Sept. 9. The total effect of Hurricanes Harvey and Irma on jobless claims remains uncertain.

In oil markets, Brent crude traded at around $55.70 a barrel on Thursday morning, up 0.98 percent, while U.S. crude was around $50.16 a barrel, up 1.74 percent.

Oil prices steadied on Thursday after the International Energy Agency (IEA) projected faster than anticipated oil demand for the remainder of the year.

Robust second-quarter demand has buoyed oil markets, which have been struggling to rebalance as a supply glut has weighed heavily on prices, the IEA said in its September report released Wednesday.