Bonds

US Treasury yields little changed heading into holiday break

Share
Key Points
  • U.S. markets will finish trading early on Dec. 24 and will be closed on Dec. 25, Christmas Day.
  • December has seen yields bounce back, with the yield on the 10-year Treasury climbing from a 1.774% yield to begin the month.

U.S. Treasury yields on Tuesday hardly budged, beginning a shortened day of trading due to the holiday season.

At around 1 p.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was lower at 1.910%, while the yield on the 30-year Treasury bond also moved down at 2.335%.

Earlier in trading the yield on the 2-year note hit a high of 1.671%, its highest level in two weeks.

U.S. markets will finish trading early on Dec. 24 and will be closed on Dec. 25, Christmas Day.

The slight move lower for yields countered Monday's small rise. Investors have been adding more risk as 2019 comes to a close, ditching bonds as U.S. stocks rally into the end of the year.

December has seen yields bounce back, with the yield on the 10-year Treasury climbing from a 1.774% yield to begin the month. U.S. government debt prices have fallen as investors have stuck by equities, unwilling to sell in a market where so few stocks have lost value.

The 10-year yield in 2019

On the data front, the Philadelphia Fed's non-manufacturing index, a key measure of business activity, fell to 13.4 in December from 20.7 the prior month. But the drop was balanced out by an increase in employment, as the Philadelphia Fed's survey saw its index of full-time non-manufacturing jobs increase to 21.7 in December from 21.1 the month before.

The Richmond Fed's survey of manufacturing fell to -5, both below last month's reading of -1 and economists' expectation of a rise to 1. The Richmond Fed said its index was "weighed down by decreases in the already negative indexes for shipments and new orders," with only the third component of employment increasing slightly.

The Treasury Department auctioned $41 billion in 5-year notes with solid demand, as the auction had a bid-to-cover ratio of 2.49, just under last month's bid-to-cover of 2.50.