Treasury yields push higher as jobless claims beat expectations
- The U.S. Department of Labor said there were 406,000 initial jobless claims last week, below the 425,00 expected by economists, according to Dow Jones.
- Thursday's rise in yields also came as President Biden is set to propose a $6 trillion budget, according to a report from the New York Times.
U.S. Treasury yields rose on Thursday morning as weekly jobless claims came in lower than expected.
The yield on the benchmark 10-year Treasury note rose to 1.6% by 4:00 p.m. ET. The yield on the 30-year Treasury bond climbed to 2.28%. Yields move inversely to prices.
Treasurys
| TICKER | COMPANY | YIELD | CHANGE |
|---|---|---|---|
| US1M | U.S. 1 Month Treasury | 5.381% | +0.018 |
| US3M | U.S. 3 Month Treasury | 5.435% | +0.046 |
| US6M | U.S. 6 Month Treasury | 5.389% | +0.015 |
| US1Y | U.S. 1 Year Treasury | 5.147% | +0.013 |
| US2Y | U.S. 2 Year Treasury | 4.816% | -0.009 |
| US10Y | U.S. 10 Year Treasury | 4.414% | -0.006 |
| US30Y | U.S. 30 Year Treasury | 4.556% | -0.005 |
The U.S. Department of Labor said there were 406,000 initial jobless claims last week, below the 425,00 expected by economists, according to Dow Jones. In the week prior, jobless claims reached a fresh pandemic-era low of 444,000.
Investors are watching jobs data closely, as the Federal Reserve has said it will wait for a fuller recovery in the labor market before it looks at tapering its asset purchases and raising interest rates.
John Plassard, deputy director at asset manager Mirabaud, told CNBC's "Squawk Box Europe" on Thursday that he believed if, and when, the central bank did decide to taper its asset purchases it would actually be a "real relief for the investor because the Fed will progressively normalize the monetary policy for good reason," pointing to higher inflation, lower unemployment and "tremendous economic growth."
In fact, Plassard argued that the "longer the Fed does nothing, the more likely it is to lose control of inflation altogether."
He expected the Fed's narrative on monetary policy to change ahead of its September meeting, "or even in August" at its annual economic symposium in Jackson Hole. However, Plassard believed it would not be a shock for the market.
"I believe that tapering is a good thing and I believe that we can live with higher rates and with lower assets to be bought by the Federal Reserve," he said.
Thursday's rise in yields also came as President Biden is set to propose a $6 trillion budget, according to a report from the New York Times.
In terms of other data out Thursday, durable goods orders for April showed an unexpected decline while the number of pending home sales last month fell 4.4%, due in part to record-low inventory of homes for sale in the first quarter.
Auctions were held Thursday for $40 billion of 4-week bills, $40 billion of 8-week bills and $62 billion of 7-year notes.
— CNBC's Yun Li, Jesse Pound and Tanaya Macheel contributed to this market report.