10-year Treasury yield ticks lower as investors assess economic data

Long-term U.S. Treasury yields moved lower on Friday as market participants sorted through a busy week of economic data.

The yield on the benchmark 10-year Treasury note dipped 5 basis points to 2.84%. The yield on the 30-year Treasury bond also ticked about 5 basis points lower to 3.108%. Yields move inversely to prices, and a basis point is equal to 0.01%.

The shorter-term 2-year Treasury yield rose slightly to basis points to 3.25% after slipping in the previous session.

Friday brought more positive news on inflation. Import were down 1.4% in July. Economists surveyed by Dow Jones expected a decrease of 1%. Export prices also fell more than expected.

The preliminary August reading for the University of Michigan consumer sentiment index came in higher than expected, and the report also showed one-year inflation expectations fall slightly. However, three-year inflation expectations ticked up.

Earlier in the wee, the producer price index fell 0.5% from June, the first month-over-month decrease since April 2020, the month after Covid-19 was declared a pandemic. Economists surveyed by Dow Jones had been expecting an increase of 0.2%.

The PPI marked a second report this week pointing to easing price pressures. Data on Wednesday showed that U.S. consumer prices rose 8.5% year over year in July, slowing from the previous month in large part due to a drop in oil prices. Economists had expected an 8.7% annual climb.

The data reflected an easing of inflation and prompted investors to question the prospects of the Federal Reserve slowing the pace of rate hikes as soon as September.