Treasuries Finish Choppy Trading Day Modestly Lower

(RTTNews) - Treasuries showed a lack of direction over the course of the trading session on Friday before eventually ending the day modestly lower.

After spending the morning bouncing back and forth across the unchanged line, bond prices remained in the red in afternoon trading. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 1.5 basis points to 4.187 percent.

The ten-year yield extended the upward trend seen over the past several sessions, reaching its highest closing level in three weeks.

The choppy trading on the day came following the release of a closely watched Commerce Department report showing consumer prices increased in line with economist estimates in the month of August.

The Commerce Department said its personal consumption expenditures (PCE) price index climbed by 0.3 percent in August after rising by 0.2 percent in July. The price growth matched expectations.

The annual rate of growth by the PCE price index ticked up to 2.7 percent in August from 2.6 percent in July, which was also in line with estimates.

Excluding food and energy prices, the core PCE price index rose by 0.2 percent in August, matching a revised increase in July as well as expectations.

The annual rate of growth by the core PCE price index came in at 2.9 percent in August, unchanged from July and in line with estimates.

"The PCE price indexes show inflation creeping higher as tariffs push up a range of goods prices," said Michael Pearce, Deputy Chief US Economist at Oxford Economics.

He added, "We estimate around two thirds of the burden of tariffs have been passed through to consumers, though the range of new sectoral tariffs announced overnight mean further price pressures are likely on the way."

President Donald Trump announced in a post on Truth Social that he will be imposing a 100 tariff on pharmaceuticals unless the company is building a manufacturing plant in the U.S.

Trump also announced a 25 percent tariff on heavy trucks and a 50 percent tariff on kitchen cabinets, bathroom vanities and associated products, with the new tariffs set to take effect October 1st.

The Labor Department's monthly jobs report is likely to be in the spotlight next week, while traders are also likely to keep an eye on reports on manufacturing and service sector activity, consumer confidence and job openings.