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Treasuries Extend Upward Move Amid Renewed Economic Worries

Following the notable advance seen over the two previous sessions, treasuries saw further upside during trading on Thursday.

Bond prices moved higher early in the session and remained firmly positive throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dropped 3 basis points to 0.619 percent.

Treasuries benefited from their appeal as a safe haven amid renewed concerns about the economic outlook after Federal Reserve Chair Jerome Powell warned of "significant downside risks" during a speech on Wednesday.

Adding to the economic worries, the Labor Department released a report showing a much smaller than expected decrease in first-time claims for unemployment benefits in the week ended May 9th.

The report said initial jobless claims fell to 2.981 million, a decrease of 195,000 from the previous week's revised level of 3.176 million.

However, economists had expected jobless claims to tumble to 2.5 million from the 3.169 million originally reported for the previous week.

Jobless claims have steadily decreased since reaching a record high of 6.867 million in late March, but the number of new claims has reached nearly 36.5 million since the coronavirus-induced economic shutdown.

"While initial claims for unemployment benefits continue to retreat from their peak, they remain at levels consistent with a labor market in distress," said a note from economists at Oxford Economics.

They added, "And the headline figures don't tell the full story since they don't capture individuals receiving benefits under state and emergency programs."

A separate report released by the Labor Department showed steep drops in both import and export prices in the U.S. in the month of April.

Trading on Friday may be impacted by reaction to a slew of U.S. economic data, including reports on retail sales, industrial production and consumer sentiment.

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