After moving higher over the course of the previous session, treasuries saw some further upside during trading on Friday following the release of some disappointing economic data.
Bond prices showed a strong upward move in early trading and managed to remain firmly positive throughout the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4.8 basis points to 2.126 percent.
With the drop on the day, the ten-year yield added to the loss posted in the previous session, pulling back further off the one-year closing high set on Wednesday.
The early strength among treasuries was partly due to the release of a report from the Federal Reserve showing that industrial production unexpectedly came in unchanged in May.
The Fed said industrial production came in flat in May following a revised 0.4 percent decrease in April. Economists had expected production to rise by 0.2 percent.
Rob Carnell, chief international economist at ING, said, "The headline production figure would have been better but for another drag from utilities, and we expect some bounce from this sector in the coming months."
"Nonetheless, this was not a great figure, and reinforces our sense that the run of data in the U.S., though stronger than might have been expected some months ago, is rather mixed," he added.
A separate report from Thomson Reuters and the University of Michigan showing an unexpected deterioration in consumer sentiment in June also increased the appeal of bonds.
The disappointing economic data helped to offset some of the recent concerns about the outlook for the Federal Reserve's asset purchase program.
Next week, all eyes are likely to be on the Fed's monetary policy meeting on Wednesday. While the Fed is not expected to announce an immediate change in policy, traders will closely examine the accompanying statement for signs of when the central bank will scale back its stimulus.
Several key economic reports are also scheduled to be released next week, including reports on housing starts, consumer prices, and existing home sales. Nonetheless, the data is likely to be overshadowed by the Fed 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.