WASHINGTON (dpa-AFX) - Following the strong upward move seen during last Friday's session, treasuries gave back some ground during trading on Monday.
Bond prices regained ground after coming under pressure early in the session but still closed modestly lower. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up 1.5 basis points to 4.275 percent.
The modest pullback by treasuries came following the surge seen in the previous session, which came in reaction to Federal Reserve Chair Jerome Powell's highly-anticipated speech before the Jackson Hole Economic Symposium.
While Powell touched only briefly on the outlook for monetary policy, his remarks increased investor confidence that the Fed will lower interest rates next month.
'With policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,' Powell said.
CME Group's FedWatch Tool is currently indicating an 84.3 percent chance the Fed will lower interest rates by a quarter point in September.
Selling pressure waned over the course of the session, however, as traders seemed reluctant to make more significant ahead of several key events later this week.
The latest U.S. economic data is likely to attract attention, with the Commerce Department due to release a report on Friday that includes the Fed's preferred readings on consumer price inflation.
Reaction to reports on durable goods orders, consumer confidence and second quarter GDP may also impact trading in the coming days.
On the U.S. economic front, the Commerce Department released a repot this morning showing new home sales in the U.S. decreased from an upwardly revised level in the month of July.
The Commerce Department said new home sales fell by 0.6 percent to an annual rate of 652,000 in July after surging by 4.1 percent to an upwardly revised rate of 656,000 in June.
Economists had expected new home sales to climb by 0.5 percent to an annual rate of 630,000 from the 627,000 originally reported for the previous month.
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