Traders at the New York Stock Exchange saw Treasury yields rise on Thursday morning after new data on weekly jobless claims was released. The yield on the 10-year Treasury jumped 5 basis points to 4.633%, while the 2-year Treasury traded 2 basis points higher at 4.359%. It’s important to note that one basis point is equal to 0.01%, and yields move inversely to prices.
According to the Labor Department’s report on jobless claims for the week ending Dec. 21, there were a total of 219,000 claims. This number was just 1,000 below the previous period and slightly lower than the 225,000 consensus forecast from Dow Jones. However, continuing claims, which lag by a week, rose to 1.91 million. This marked an increase of 46,000 claims and the highest level since Nov. 13, 2021.
The benchmark 10-year rate has seen a significant increase of more than 40 basis points this month. The majority of this rise came after the Federal Reserve adjusted their rate-cut projections, indicating only two more potential interest rate cuts in 2025. This is a decrease from the four cuts that were previously anticipated back in September.
Overall, the market reaction to the latest jobless claims data and the Federal Reserve’s updated projections has been significant. Investors will continue to monitor economic indicators and central bank announcements closely to gauge the direction of Treasury yields and the broader financial markets.
