WASHINGTON (dpa-AFX) - Treasuries once again failed to sustain an early move to the upside after came under pressure over the course of the trading day on Wednesday.
Bond prices pulled back well off their early highs and firmly into negative territory as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 4 basis points to 5.29 percent.
The ten-year yield closed higher for the seventh consecutive session, reaching its highest closing level since May 2002.
Treasuries initially benefitted from a positive reaction to a closely watched report on consumer price inflation in the U.S.
The report from the Commerce Department showed consumer prices rose by less than expected on a monthly basis in August, while the annual rate of price growth also came in below estimates.
While the annual rate of consumer price growth remains well above the Federal Reserve's 2 percent target, traders may have felt the data reduced the likelihood the central bank will raise interest rates next month.
According to CME Group's FedWatch Tool, the chances the Fed will raise rates by a quarter point have fallen to 37.1 percent from 50.9 percent on Tuesday.
Buying interest waned over the course of the session, however, as some analysts suggested the inflation data is not likely to persuade the Fed to leave rates unchanged in light of signs of continued strength in the labor market.
A report released by payroll processor ADP this morning showed private sector employment in the U.S. jumped by more than expected in the month of September.
ADP said private sector employment shot up by 90,000 jobs in September after rising by a downwardly revised 36,000 jobs in August.
Economists had expected private sector employment to increase by 70,000 jobs compared to the addition of 38,000 jobs originally reported for the previous month.
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