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Treasury Yields Are Slightly Lower After Big Run-Up This Week

Source: NYSE

U.S. Treasury yields were lower Wednesday after a steep run-up this week.

The yield on the benchmark 10-year Treasury note was lower by 2.7 basis points at 1.638%.. The benchmark yield peaked above 1.68% earlier in the session. The yield on the 30-year Treasury bond was down about 6 basis points, falling to 1.954%. Yields move inversely to prices and 1 basis point is equal to 0.01%.

Yields have jumped sharply this week, as the 10-year Treasury yield was trading near 1.54% on Friday. Federal Reserve Chair Jerome Powell was renominated for a second term on Monday.

Minutes released Wednesday from the Fed's policy meeting earlier this month showed central bank members are prepared to raise interest rates sooner than expected if inflation runs too hot. During the November meeting, the Fed confirmed its plans to start tapering its $120 billion monthly bond-buying program but left interest rates near zero.

"Some participants suggested that reducing the pace of net asset purchases by more than $15 billion each month could be warranted so that the Committee would be in a better position to make adjustments to the target range for the federal funds rate, particularly in light of inflation pressures," the minutes said.

While the longer-date Treasury yields fell on Wednesday, the shorter-end picked up, flattening the yield curve.

On the data front, U.S. jobless claims tumbled to 199,000 last week, hitting their lowest level in more than 52 years, the Labor Department reported Wednesday. The report easily beat Dow Jones estimates of 260,000. Personal income and consumer spending both rose more than expected.

The third-quarter GDP was revised up slightly to 2.1%, though it missed an estimate of 2.2%.

However, other data points on Wednesday weren't as solid. Census Bureau said durable goods orders showed an unexpected decline in October. Core PCE, the Fed's preferred measure of inflation, was up 4.1% year over year in October, matching estimates.

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