US Treasury bond yields fell early on Friday before major inflation data was released that morning.
The benchmark ten-year government bond yield fell 3 basis points to 1.4944% at 4.20 a.m. ET. The yield on the 30-year government bond also fell by 3 basis points to 2.056%. The returns move inversely to the prices and 1 basis point equals 0.01%.
The 10-year rate topped 1.56% earlier in the week, its highest level since June, amid investor concerns over persistent inflation and tighter monetary policy.
The August core consumer spending price index, the measure of inflation used by the Federal Reserve to determine its policy schedule, will be released on Friday at 8:30 a.m. ET. Economists polled by Dow Jones predict that the core CPI will rise 0.2% in August and 3.5% year-over-year.
Geoffrey Yu, senior marketing strategist at BNY Mellon, told CNBC’s Squawk Box Europe on Friday that the US may be in a “slightly better position” than other countries on rising prices. He explained that both the producer price index and the consumer price index are high in the US, which meant that companies could pass some of that price pressure on to underlying consumers.
By comparison, China’s PPI is “very problematic,” but the CPI is “close to 1%,” said Yu, putting more pressure on the company’s margins and profits.
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August personal income and expense data will also be released at 8:30 a.m. ET.
Markit’s final manufacturing purchasing managers’ index for September is expected to be released at 9:45 a.m. ET, while the ISM manufacturing PMI for the final month is released at 10 a.m. ET.
In addition, August construction spending data is due to be released at 10 a.m. ET.
Meanwhile, Congress stood ready to prevent the government from closing on Thursday. The Senate and House of Representatives both passed a short-term funds bill that would keep the government going through December 3, and sent it to President Joe Biden for signature.
There are no auctions on Friday.
– CNBC’s Yun Li contributed to this market report.