Treasury yields pulled back sharply on Thursday following softer-than-expected inflation data and as investors awaited Friday's jobs data.
The yield on the benchmark 10-year Treasury fell to 3.512%, losing nearly 19 basis points. The 2-year Treasury yield was last at 4.24% after declining by just over 13 basis points.
Yield and prices have an inverted relationship and one basis point is equivalent to 0.01%.
The slide deepened following the release of the October Core Personal Consumption Expenditures Index, a gauge of household spending. It rose 0.2%, which was below Dow Jones' consensus estimate of 0.3%.
The move also followed a pull back that started Wednesday as markets assessed the outlook for future interest rate hikes after Federal Reserve Chair Jerome Powell said on Wednesday that the pace of rate hikes could be slowed as soon as December.
"It makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down," he explained at an event held by the Brookings Institution.
His tone echoed that of other Fed speakers, who have in recent weeks indicated that rates would continue to rise, but likely in smaller increments. The central bank has implemented four consecutive 75 basis point rate hikes so far this year, and traders are now expecting a 50 basis point increase from its December meeting.
Investors will be watching for jobs data on Friday that could offer insights into the Fed's future rate tightening decisions.