10-year Treasury yield rises as wholesale prices fall in March

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The 10-year Treasury yield rose Thursday as investors digested the March producer prices index that came in cooler than expected.

The yield on the benchmark 10-year Treasury note climbed nearly 3 basis points to 3.449%. The 2-year Treasury yield was little changed and was last trading at 3.966%.

Yields and prices move in opposite directions and one basis point equals 0.01%.


The March producer prices index, a measure of prices paid by companies and often a leading indicator of consumer inflation, showed a 0.5% decline month over month, compared to expectations it would be flat. Excluding food and energy, the core wholesale prices reading shed 0.1% month over month, much better than the 0.2% increase forecasted by economists polled by Dow Jones.

That reading follows the consumer price index, which published Wednesday and also indicated that inflationary pressures could be easing.

Prices climbed by 0.1% on a monthly basis in March and 5% year over year, just below the 0.2% and 5.1% increases economists previously surveyed by Dow Jones had expected.

The data is likely to influence the Fed's next policy moves. After its last meeting, the central bank indicated that, depending on economic data, interest rate hikes may be paused soon. Many investors are, however, expecting a further 25 basis point rate hike at the conclusion of the Fed's May meeting.