Treasury Yields Nudge Higher With Payroll Report Viewed as the Next Big Catalyst

Thursday morning saw minimal changes in yields on U.S. government debt, with rates on 10- and 30-year Treasurys remaining near four-month peaks, following the release of weekly initial jobless benefit claims which offered limited indications of deterioration in the labor market.

‍

Here's a breakdown of the latest figures:

• The yield on the 2-year Treasury note (BX:TMUBMUSD02Y) remained nearly unchanged at 4.676%, compared to 4.679% recorded on Wednesday.
• The yield on the 10-year Treasury note (BX:TMUBMUSD10Y) decreased by 3 basis points to 4.324%, down from 4.354% reported on Wednesday.
• The yield on the 30-year Treasury note (BX:TMUBMUSD30Y) dropped by 3.6 basis points to 4.473%, as opposed to 4.509% seen on Wednesday.

‍

Market dynamics are primarily influenced by the latest data, indicating that initial jobless-benefit claims ascended to a nine-week high of 221,000, yet remained within the range of 194,000-225,000 observed throughout the year.

‍

According to economists surveyed by The Wall Street Journal, the anticipated total of new claims for the seven days ending on March 30 was 213,000, based on seasonally-adjusted figures.

‍

Attention is now focused on Friday's nonfarm payroll report for March, which is projected to reveal the creation of 200,000 jobs last month. This report is poised to inform the Federal Reserve's decision-making regarding the appropriate trajectory for interest rates.

‍

Recent robust data pertaining to the U.S. labor market and manufacturing sector have propelled long-term yields to their highest levels since November earlier this week.

‍

Analysts have weighed in on the current situation, with Jefferies economist Thomas Simons and analyst Nathan Bilski noting, "So far in 2024, we have seen a pivot towards more frequent and larger layoff announcements from prominent businesses across various sectors of the labor market.

‍

While these announcements have not yet manifested in increased claims counts, we anticipate this trend will shift in the near future."

‍