Treasury 10-year note yields touched a seven-month high as evidence the U.S. economy is recovering reduced demand for safety.
“It’s a snowball effect in Treasuries as we are seeing flow-driven trades that have been exacerbated by the improving economic data,” said Kevin Flanagan, a Purchase, New York-based fixed-income strategist at Morgan Stanley Smith Barney.
Yields rose earlier as reports showed Philadelphia area manufacturing beat forecasts, initial jobless claims unexpectedly fell and housing starts increased for the first time in three months. Yields pared gains as Moody’s Investors Service said it placed Greece’s Ba1 local and foreign currency government bond ratings on review for possible downgrade.
The yield on the 10-year note dropped less than one basis point, or 0.01 percentage point, to 3.53 percent at 11:54 a.m. in New York, according to BGCantor Market Data. The price of the 2.625 percent security maturing in November 2020 rose 2/32, or 63 cents per $1,000 face amount, to 92 1/2. The yield touched 3.56 percent, the highest level since May 13, after earlier falling to an intraday low of 3.46 percent. (more)
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