Authorities bond yields have been combined forward of unemployment claims information
US Treasury bond yields were mixed on Thursday morning before weekly unemployment claims data was released.
The benchmark 10-year Treasury note yield fell to 1.653% at 5 a.m. ET. The yield on the 30-year government bond rose to 2.337%. The returns move inversely to the prices.
Investors are likely to ponder the Labor Department’s latest update on unemployment claims, which will be released at 8:30 a.m. ET, given last week’s blockbuster salary report. Economists polled by Dow Jones expect unemployment insurance claims totaling 694,000 for the week ending April 3.
Recently, returns have risen on inflation concerns as the coronavirus pandemic rebounded economically. However, the Federal Reserve announced at its March meeting that it would allow inflation to exceed its long-term target of 2% if it helps to achieve full employment.
Minutes of the March March Fed meeting, released on Wednesday, confirmed that adjustment policies should be maintained until economic “results” are achieved.
Sarah Hewin, director of research for Europe and America at Standard Chartered Bank, told CNBC’s Squawk Box Europe on Thursday that it appeared that the Fed had taken into account some of the improvements in economic data since that last meeting.
“So I think that in large part they are taking into account some very high salary numbers in the coming months,” she said, but added that there was uncertainty about “how far the current strength of the economy will hold”.
However, Hewin cited a study published yesterday by the New York Fed that highlighted that many of the recent economic tests have been put into saving and paying off debt rather than being spent. She suggested it was “sensible” for the Fed to take a “cautious approach” to policy at this stage.
She added: “There is still a large output gap and, from the Fed’s perspective, this output gap needs to be closed in order for inflation to get back on target and actually stay above target for a while.”
Fed Chairman Jerome Powell will address the International Monetary Fund’s debate on the world economy on Thursday at 12:00 noon (CET).
Auctions will be held Thursday for 4-week invoices valued at $ 40 billion and 8-week invoices valued at $ 40 billion.
– CNBC’s Thomas Franck contributed to this report.