Treasury yields bounce on hopes economy can start to reopen soon

Treasury yields climbed higher on Friday as investors grew more hopeful about an economic recovery after the Trump administration released tentative steps toward restarting the country.

The yield on the benchmark 10-year Treasury note, which moves inversely to price, rose 4 basis points to 0.64%, while the yield on the 30-year Treasury bond was also higher at 1.24%.

President Donald Trump said on Thursday issued guidelines to open up parts of the U.S. Thursday night, which identifies the circumstances necessary for areas of the country to allow employees to start returning to work.

Investors also cheered reports about a Gilead Sciences drug that showed some effectiveness in treating the coronavirus. STAT news reported that a Chicago hospital treating coronavirus patients with remdesivir in a trial were recovering rapidly from severe symptoms.

On Thursday, long-dated Treasury yields dropped on the back of new unemployment data. Another 5.25 million Americans applied for unemployment benefits last week showing how the coronavirus shutdowns are hitting the economy.

Traders were also digesting data news out of China, which showed the economy contracted by 6.8% in the first quarter. 

Friday’s data calendar is relatively thin with only March’s Leading Economic Index due at 10 a.m. ET. St. Louis Fed President James Bullard is due to speak via a webcast at 9 a.m. ET.

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