Treasuries Give Back Ground Following Recent Strength

(RTTNews) - After trending higher over the past several sessions, treasuries gave back some ground during the trading day on Wednesday.

Bond prices climbed off their worst levels going into the close but remained in the red. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.8 basis points to 1.755 percent.

The weakness among treasuries was partly due to profit taking following the recent strength, which pushed the ten-year yield down to its lowest closing level in over a month.

Strength on Wall Street may also have led some traders to move money out of the bond market, with stocks rebounding after closing lower in the two previous sessions.

Treasuries saw continued weakness following the release of the minutes of the Federal Reserve's most recent monetary policy meeting.

The minutes revealed that Fed officials discussed the possibility of raising interest rates at the next meeting later this month.

While several officials expressed concern that raising rates in April would signal a sense of urgency they did not think appropriate, other indicated that a rate hike might well be warranted if incoming economic data remained consistent with their expectations.

Chris Low, chief economist at FTN Financial, said, "The decision to avoid hinting at an increased possibility of a hike at the next meeting suggests the doves dominated this discussion."

"Still, the failure to downgrade the balance of risks suggest it was not a complete rout," he added. "The hawks still have influence."

The economic calendar remains relatively quiet on Thursday, although the Labor Department is due to release its report on weekly jobless claims.