NEW YORK: US Treasury debt prices declined on Thursday, with yields on benchmark 10-year notes backing away from two-month lows amid fresh signs America's labor market continues to grow.
In light trading ahead of Friday's frequently market moving US monthly employment report, prices of 10-year Treasuries were last off 10/32 and yielding 1.9039 percent, according to Thomson Reuters data.
The 30-year bond, which rallied strongly on Wednesday after the ADP National Employment Report showed private-sector job increases of only 189,000 in March, was off 30/32 on Thursday and yielding 2.5186 percent.
Shorter maturities were also mostly down moderately in price. Yields on Treasuries, including a nearly two-month low for the 10-year note of 1.831 percent touched in overseas trading, had been dropping on mushrooming worries about US economic growth and bets the Federal Reserve may push back hikes in interest rates.
The government on Thursday said the number of Americans filing new claims for unemployment benefits unexpectedly fell last week.
Initial claims for state unemployment benefits dropped 20,000 to a seasonally adjusted 268,000 for the week ended March 28, the Labor Department said.
Economists polled by Reuters had forecast claims rising to 285,000.
Treasuries, which have posted gains for five straight quarters, were up before the jobs claims data were published.
Wall Street stocks, which often move in the opposite direction of bonds, broke a two-session losing streak and were up in late trading.
"That claims number caught the market off guard because most of the numbers we have been seeing recently have been on the soft side," said Donald Ellenberger, strategist and portfolio manager for Federated Investors in Pittsburgh.
"Most people had been expecting a softer jobs number, and this calls that into doubt." Economists polled by Reuters estimated that US non-farm payrolls rose by 245,000 last month, following a 295,000 gain in February, and that the jobless rate was steady at 5.5 percent.
"The risks are tilted in the direction of a weak number," said Millan Mulraine, deputy chief economist at TD Securities in New York. "To be sure, our guess is that the risks of job growth falling below the psychological 200,000 mark are low."
The state of the US jobs market is seen as central to Fed policymakers, who will determine when to hike Fed interest rates for the first time since 2006.
Separately, on Friday, the Commerce Department said new orders for US manufactured goods increased 0.2 percent, ending six straight months of declines.
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