Bond Prices Decline On Mixed U.S. Data
The bears went on the offensive in the Treasury market Friday after a data deluge further eroded fading hopes for a Fed rate cut this year.</br></br>With a 5% yield on the benchmark 10-year note a hair's breadth away, some investors already are bracing for more of a bear run.</br></br>Within 90 minutes, Treasury traders were hit by some of the most significant numbers on the U.S. economic calendar. First, there were data on nonfarm payrolls and personal income and spending, which includes the Fed's favored inflation gauge. Rounding things off were the Institute for Supply Management's manufacturing survey, the Reuters/University of Michigan consumer-sentiment survey and pending home sales.</br></br>If this economic Super Friday had revealed across-the-board economic weakness, it could easily have blunted -- and may have reversed -- a Treasury-market bear run that saw prices slide through most of May.</br></br>It wasn't so. What proved to be mixed economic data kept the selling pressure intact and lifted the yield on the 10-year note to 4.955%. And with market momentum as strong as it is and traders talking of accelerating mortgage-related selling, the risk of falling deep in the red looks significant.