WASHINGTON (dpa-AFX) - After ending Wednesday's trading roughly flat following the Federal Reserve's monetary policy decision, treasuries moved to the upside during trading on Thursday.
Bond prices gave back some ground after an early advance but remained firmly positive throughout the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell 4.3 basis points 4.512 percent.
With the decrease on the day, the ten-year yield ended the session at its lowest closing level in well over a month.
The strength among treasuries came after the Commerce Department released a report showing U.S. economic growth in the fourth quarter of 2024 fell short of economist estimates.
The report said gross domestic product shot up by 2.3 percent in the fourth quarter after surging by 3.1 percent in the third quarter. Economists had expected GDP to jump by 2.6 percent.
The Commerce Department said the GDP growth in the fourth quarter primarily reflected increases in consumer spending and government spending that were partly offset by a decrease in investment.
'Despite Q4 GDP growth surprising to the downside on the surface, the economy ended 2024 on a strong note,' said FHN Financial Macro Strategist Will Compernolle. 'Domestic demand is strong, inflation came in as expected, and a huge inventory drawdown is unlikely to sustain into upcoming quarters.'
He added, 'The Fed can look at this report and remain cautiously optimistic that inflation is not meaningfully accelerating, and growth is not falling below potential.'
Meanwhile, a separate report released by the Labor Department showed first-time claims for U.S. unemployment benefits pulled back by more than expected in the week ended January 25th.
The Labor Department said initial jobless claims fell to 207,000, a decrease of 16,000 from the previous week's unrevised level of 223,000. Economists had expected jobless claims to slip to 220,000.
A Commerce Department report on personal income and spending is likely to be in focus on Friday, as it includes readings on consumer price inflation preferred by the Federal Reserve.
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