Government bond yields rise after unemployment claims report

US Treasury yields rose Friday as investors digested the previous day’s data, which showed unemployment claims came in lower, below expectations.

The yield on the 10-year Treasury bond was up 4 basis points at 8:30 a.m. ET to 2.926%, while the yield on the 30-year Treasury bond rose about 3 basis points to 3,1728%. Yields move inversely to prices and a basis point equals 0.01%.

The yield on the short-term 2-year Treasury also rose about 2 basis points at 3.255%.

The rise in interest rates was a shift from the previous session, in which rates cooled as markets brooded over the minutes of the Federal Reserve’s July meeting. The Fed said it would continue to raise interest rates until inflation slows significantly, although the central bank could slow the pace of tightening soon.

Thursday also revealed a further slowdown in housing demand, with home sales falling nearly 6% in July as the housing market began to contract.

Jobless claims totaled 250,000 for the week ending Aug. 13, down 2,000 from the previous week and below the Dow Jones estimate of 260,000.

Markets and monetary policy officials are keeping a close eye on the labor market, as interest rate hikes are intended to cool the labor market and 40 years of high inflation. Fed policymakers said lowering inflation is the top priority, even if it means a decline in hiring, according to minutes released Wednesday.

The Fed is considering another major rate hike in September, said St. Louis president James Bullard, Fed President James Bullard, adding that he cannot say for sure that inflation has peaked.

“We need to push forward vigorously to levels of key interest rates that will put significant downward pressure on inflation…I don’t really understand why you want to drag the rate hikes into next year,” Bullard said in an interview. with the Wall Street Journal.

Data will be released Friday on oil rig counts conducted by Baker Hughes.

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