Treasuries Give Back Ground As Jobless Claims Slump To Three-Year Low

(RTTNews) - Treasuries moved to the downside during trading on Thursday, giving back ground after moving higher over the two previous sessions.

Bond prices came under pressure early in the session and remained firmly negative throughout the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, advanced 5.1 basis points to 4.108 percent.

The pullback by treasuries came following the release of a Labor Department report showing first-time claims for U.S. unemployment benefits unexpectedly fell to a three-year low in the week ended November 29th.

The report said initial jobless claims slid to 191,000, a decrease of 27,000 from the previous week's revised level of 218,000.

Economist had expected jobless claims to rise to 220,000 from the 216,000 originally reported for the previous week.

With the unexpected decline, jobless claims dropped to their lowest level since hitting 189,000 in the week ended September 24, 2022.

While the data partly offset recent optimism about the Federal Reserve cutting interest rates next week, the central bank is still widely expected to lower rates by another quarter point.

"Initial claims can be subject to big swings at this time of the year, so we won't read much into one week's number," Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

She added, "Still, initial claims have remained in a range consistent with a relatively low pace of job losses despite recent layoff announcements."

Trading on Friday may be impacted by reaction to closely watched readings on consumer price inflation in September, although the data could be seen as too backward looking to impact next week's Fed decision.