Treasuries Come Under Pressure After Early Move To The Upside

(RTTNews) - Treasuries recovered from recent weakness early in the session on Friday but once again came under pressure over the course of the trading day.

Bond prices pull back well off their early highs and into negative territory. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 3.1 basis points to 4.317 percent after hitting a low of 4.211 percent.

With the turnaround, the ten-year yield closed higher for the fourth straight, continuing to rebound after hitting its lowest intraday level since October during trading on Tuesday.

Treasuries initially benefited from concerns about the economy after the Labor Department released a report showing employment in the U.S. increased by slightly less than expected in the month of February.

The closely watched report said non-farm payroll employment climbed by 151,000 jobs in February after rising by a downwardly revised 125,000 jobs in January.

Economists had expected employment to grow by 160,000 jobs compared to the addition of 143,000 jobs originally reported for the previous month.

The report also said the unemployment crept up to 4.1 percent in February from 4.1 percent in January, while economists had expected the unemployment rate to remain unchanged.

However, treasuries came under pressure as Federal Reserve Chair Jerome Powell reiterated the central bank does not "need to be in a hurry" to adjusted interest rates amid uncertainty about the effects of President Donald Trump's policy changes.

Powell argued during remarks at the University of Chicago Booth School of Business 2025 U.S. Monetary Policy Forum that the Fed is "well positioned to wait for greater clarity" about the impact of Trump's policy changes.

"If the economy remains strong but inflation does not continue to move sustainably toward 2 percent, we can maintain policy restraint for longer," Powell said. "If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly."

He added, "Our current policy stance is well positioned to deal with the risks and uncertainties that we face in pursuing both sides of our dual mandate."

Reports on consumer and producer price inflation are likely to be in focus next week along with readings on consumer sentiment and inflation expectations.