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Bond Report: U.S. government bond yields inch up ahead of data, ECB press conference

January 21
18:52 2021

U.S. Treasury yields were slightly higher on early Thursday’s trade as investors eyed a policy update from the European Central Bank and some upcoming U.S. economic data.

What are Treasurys doing?

The 10-year Treasury note rate TMUBMUSD10Y, 1.100% rose 1.1 basis points to 1.101%, while the 2-year note yield TMUBMUSD02Y, 0.133% held steady at 0.131%. The 30-year bond yield TMUBMUSD30Y, 1.859% was up 1.2 basis point to 1.854%.

What’s driving Treasurys?

The European Central Bank, as expected, made no changes to interest rates or its asset-buying program on Thursday. ECB President Christine Lagarde will now hold a press conference at 8:30 a.m. ET.

The 10-year German government bond yield TMBMKDE-10Y, -0.498% was up 1.3 basis points to negative 0.546%.

A slate of U.S. economic data in the morning will give a snapshot of the unemployment picture and housing market activity. Weekly jobless benefit claims and December housing starts are both due at 8:30 a.m. ET.

Investors have been sensitive to signs of a deteriorating labor market, after claims for unemployment benefits unexpectedly surged to 965,000 in the week ending in Jan. 9.

What did market participants say?

” Whether Lagarde remarks move the market is far from certain, but the point today is about conveying a message of cautious optimism without” sparking a strengthening of the euro and a steepening of European yield curves, said Kenneth Broux, an analyst at Société Générale.

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