US Treasury yields rise as traders assess growth prospects
U.S. Treasury yields rose on Thursday as investors digested the continued deluge of corporate earnings and continued to assess growth and inflation prospects.
Around 6:20 a.m. ET, the yield on the benchmark 10-year Treasury rose to 3.0471% while the yield on the 30-year Treasury rose to 3.1754%. Yields move inversely to prices.
The 2-year yield fell to 3.2338%, but remained above the 10-year, continuing the inversion of the closely watched 2-year/10-year yield curve.
Yield curve inversions – when short-term government bonds have higher yields than longer-term bonds despite lower risk – are often seen by markets as signs that a recession is imminent.
Markets are trying to gauge whether the Federal Reserve will raise interest rates by 75 basis points or a more aggressive 100 basis points at its policy meeting next week as it seeks to rein in sky-high inflation.
Risk sentiment among investors remained volatile, but Wall Street enjoyed a rebound in July and major stock indexes closed a third consecutive positive trading session on Wednesday. However, equity futures slipped slightly on Thursday morning on another round of earnings slightly below par.
Data releases on Thursday will include last week’s unemployment insurance claims numbers and the Philadelphia Fed’s manufacturing index for July.
Auctions will be held on Thursday for $55 billion in 4-week Treasury bills and $50 billion in 8-week Treasury bills, as well as $17 billion in 10-year TIPS (Treasury Inflation-Protected Securities).