After moving notably lower in the previous session, treasuries showed a lack of direction throughout the trading day on Friday.
Bond prices spent the day bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 2.352 percent.
The choppy trading by treasuries came as traders digested a report from the Labor Department showing stronger than expected job growth in the month of April.
The report said non-farm payroll employment jumped by 211,000 jobs in April after climbing by a downwardly revised 79,000 jobs in March. Economists had expected employment to increase by 185,000 jobs.
With the stronger than expected job growth, the unemployment rate edged down to 4.4 percent in April from 4.5 percent in March. The unemployment rate had been expected to tick up to 4.6 percent.
The unexpected decrease pulled the unemployment rate down to its lowest level since a matching rate in May of 2007.
The report also said the annual rate of growth in average hourly employee earnings slowed to 2.5 percent in April from 2.6 percent in March.
The data largely reinforced expectations that the Federal Reserve will raise interest rates by another quarter point next month.
The economic calendar for next week starts off relatively quiet, but traders are likely to keep an eye on reports on retail sales and producer and consumer prices due later in the week.
Bond traders are also likely to keep an eye on the results of the Treasury Department’s auctions of three-year and ten-year notes and thirty-year bonds.
The Treasury plans to auction $24 billion worth of three-year notes next Tuesday, $23 billion worth of ten-year notes next Wednesday and $15 billion worth of thirty-year bonds next Thursday.
The material has been provided by InstaForex Company – www.instaforex.com
May 06, 2017 at 12:52AM
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