Treasury yields in focus as investors await economic data

US Treasury yields were slightly lower on Friday as market participants waited for fresh economic data.

The benchmark 10-year Treasury yield fell less than 1 basis point to 2.8857%. The yield on the 30-year government bond also fell less than 1 basis point to 3.1554%. Yields move inversely with prices and one basis point equals 0.01%.

The shorter-dated 2-year Treasury yield fell 1 basis point to 3.215% after slipping in the previous session after another economic report showed a slowdown in inflation.

The moves helped moderate inversions along the yield curve, which Wall Street sees as recession signals.

The producer price index, which measures received prices for consumer products, fell 0.5% from June, the first month-on-month decline since April 2020, the month after Covid-19 was declared a pandemic. Economists surveyed by Dow Jones had expected growth of 0.2%.

The PPI marked a second report this week suggesting easing price pressures. Data on Wednesday showed that US consumer prices rose 8.5% year-on-year in July, slowing from the previous month in large part due to a fall in oil prices. Economists had expected an 8.7% annual increase.

The data reflected a slowdown in inflation, prompting investors to question the prospect that the Federal Reserve would slow the pace of interest rate hikes as early as September.

Market participants will again await the release of economic data on Thursday for more clues on the health of the US economy.

Import prices for July will be released around 8:30am ET, with a preliminary reading of August consumer sentiment to follow at 10:00am ET.

— CNBC’s Jesse Pound contributed to this report. Treasury yields in focus as investors await economic data

Joshua Buckhalter

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