The U.S. Treasury yield fell on Thursday morning, although the 10-year rate was above 1.68 percent, according to a higher-than-expected inflation print.
The yield on the benchmark 10-year Treasury bill dropped to 1.6864% by 4:40 AM ET. The yield on the 30-year Treasury bill dropped to 2.4010%. The yield would change in contrast to the price.
The 10-year yield closed 1.70% of the previous session, a one-month high after a major inflation report showed prices rising faster than expected.
The consumer price index for April was up 4.2 percent, its biggest annual increase since 2008 and above consensus forecast of 3.6 percent.
Inflation is a growing concern for investors. But the Federal Reserve insists any price hike should be temporary, with the economy reopening in recovery from the coronavirus outbreak.
Carl Weinberg, chief economist at High Frequency Economics, told CNBC̵7;s “Squawk Box Europe” on Thursday that he agreed with the comments of Fed vice president Richard Clarida following inflation reports that rising prices appeared to be temporary.
Weinberg believes part of the reason for this “temporary” inflation is people spending more on goods than services, with businesses shut down due to public health restrictions last year.
However, as the service sector is open to reserve, Weinberg has argued that this would. “Putting equal price pressure” between spending on products and services.
He believed it was a matter of waiting. “I think a month or two and things will look much better on the inflation and growth pages by the end of summer.”
In terms of data on Thursday, the April Producer Price Index is expected to be released at 8:30 AM ET.The PPI is also an indicator of inflation, although it is not exactly the same as the CPI, as it looks at the price growth from a producer perspective.
Additionally, weekly jobless claims information will be released at 8:30 a.m. ET.
Fed Governor Christopher Waller is the latest member of the central bank to deliver a speech this week on US economic outlook and monetary policy at the annual Global Interdependence Center’s annual finance and trade conference. 39 at 1:00 p.m. ET.
The auction will be held on Thursday for $ 40 billion of four-week bills, $ 40 billion of eight-week bills and $ 27 billion of 30-year bonds.