WASHINGTON (dpa-AFX) - Treasuries fluctuated over the course of the session but largely maintained a negative bias, extending the downward move seen over the two previous sessions.
Bond prices ended the day off their lows of the session but still firmly in the red. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 1.8 basis points to 4.481 percent.
With the increase on the day, the ten-year closed higher for the third straight session, reaching a new ten-month closing high.
The continued weakness among treasuries came following the release of a Labor Department report showing producer prices in the U.S. shot up by much more than expected in the month of April.
The Labor Department said its producer price index for final demand jumped by 1.4 percent in April after climbing by an upwardly revised 0.7 percent in March. Economists had expected producer prices to rise by 0.5 percent.
The bigger than expected monthly increase by producer prices marked the largest advance since a 1.7 percent jump in March 2022.
The report also said the annual rate of growth by consumer prices soared to 6.0 percent in April from 4.3 percent in March, coming in well above economist estimates for a 4.9 percent surge and marking the fastest growth since a 6.4 percent spike in December 2022.
'The jump in input prices portends further increases for consumer prices in May,' said Nationwide Senior Economist Ben Ayers. 'We expect annual CPI inflation to move above 4.0 percent in May with energy prices still highly elevated more than two months into the Iranian conflict.'
He added, 'With inflation still trending higher, we expect the hawkish wing of the FOMC to advocate for an extended pause in interest rates even with incoming Fed Chair Kevin Warsh likely to prefer to lower rates over time.'
Treasuries recovered from their worst levels amid a sharp pullback by the price of crude oil, which seemed to reflect optimism President Donald Trump's meeting with his Chinese counterpart Xi Jinping could help end the U.S.-Iran conflict.
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