U.S. Treasury yields fell on Thursday as investors awaited a wholesale inflation reading and weighed the state of the U.S. economy.
The benchmark 10-year Treasury yield slipped more than 2 basis points to 4.023%, while the 30-year Treasury bond yield dropped less than 2 basis points to 4.675%. The 2-year Treasury note yield was also lower by less than 2 basis points at 3.452%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
On Thursday, the Labor Department reported that initial unemployment claims for the week ended Feb. 21 stood at 212,000. Though that marked an increase of 4,000 from the prior week's upwardly revised figure, it was below the Dow Jones forecast for 215,000.
"Surprisingly, the only non-volatile economic metric these days appears to be labor data, which is throwing a curve ball to the bond market and Fed," said Todd Schoenberger, CIO at CrossCheck Management.
This comes after the Bureau of Labor Statistics reported earlier this month that job growth in January was strong, as it came in at 130,000 compared to the 55,000 that economists polled by Dow Jones had expected.
"After the recent [nonfarm payrolls] print, it's obvious the labor market isn't nearly as fragile as everyone thinks it is," Schoenberger continued.
Investors are looking ahead to the January reading of the producer price index on Friday, set to be released by the Bureau of Labor Statistics in the morning. Economists are expecting a gain of 0.3% for both headline and core, which excludes food and energy.
Schoenberger anticipates that the report will come in "much cooler," adding that it should lead to an increase in risk appetite for equities among investors.
