Treasuries Extend Notable Downward Move Following Jobless Claims Data

Treasuries showed a significant move to the downside during trading on Thursday, extending the sharp pullback seen in the previous session.

Bond prices came under pressure in early trading and remained firmly negative throughout the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 7.9 basis points to 4.073 percent.

The ten-year yield added to the 7.8 basis point advance seen in the previous session, closing above 4.0 percent for the first time since early last November.

The extended weakness among treasuries came amid ongoing concerns about the outlook for interest rates following recent economic data.

With the Federal Reserve warning about the impacts of labor market tightness, selling pressure was generated in reaction to a Labor Department report unexpectedly showing a modest decrease in initial jobless claims.

The Labor Department said initial jobless claims edged down to 190,000 in the week ended February 25th, a decrease of 2,000 from the previous week's unrevised level of 192,000. Economists had expected jobless claims to inch up to 195,000.

"The jobless claims data continue to tell the same story: The labor market is too tight to help the Fed in its effort to lower inflation and the data leave the Fed on track to raise interest rates at the next three meetings," said Nancy Vanden Houten, Lead US Economist at Oxford Economics.

A report on U.S. service sector activity may attract attention on Friday, with traders looking for additional clues about the outlook for the economy and interest rates.

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