While buying interest remained subdued, treasuries saw modest strength during trading on Tuesday, extending a recent upward move.
Bond prices showed a lack of direction for much of the session but ended the day modestly higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 1.777 percent.
The drop on the day extended the recent downward trend by the ten-year yield, which ended the session at a new seven-month closing low.
Treasuries benefited from continued uncertainty about the political situation in Greece, which is headed for a new round of elections after lawmakers failed to form a coalition government.
The new elections are seen as referendum on whether Greece should remain a member of the eurozone, adding to the recent worries about Europe.
However, a batch of relatively upbeat U.S. economic data helped to limit the upside for treasuries, with a report from the National Association of Home Builders showing that its reading on homebuilder confidence reached a five-year high in May.
The report showed that the NAHB/Wells Fargo Housing Market Index jumped to 29 in May from a downwardly revised 24 in April. Economists had expected the index to edge up to 26 from the 25 originally reported for the previous month.
A separate report from the New York Federal Reserve showed a much faster than expected expansion in New York manufacturing activity
The New York Fed said its general business conditions index jumped to 17.1 in May from 6.6 in April, with a positive reading indicating an increase in regional manufacturing activity. Economists had expected the index to show a more modest increase to a reading of 10.0.
Additionally, the Commerce Department said retail sales edged up by 0.1 percent in April following a revised 0.7 percent increase in March. Economists had expected sales to increase by 0.1 percent compared to the 0.8 percent growth originally reported for the previous month.
Core sales, which exclude gas, autos, and building materials, rose by 0.4 percent in April, exceeding estimates for a 0.3 percent increase.
The situation in Greece is likely to remain in focus on Wednesday, although traders are also likely to keep an eye on U.S. reports on housing starts and industrial production.
Trading could also be impacted by the release of the minutes of the Federal Reserve's most recent monetary policy meeting.
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Market Analysis
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.