US Treasury yields mixed after 30-year bond falls to historic low - CNBC

U.S. government bond prices were higher on Thursday as fears of a global recession drove investors to the perceived safety of government debt.

U.S. Markets Overview: Treasurys chart

Around 6 a.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was at 1.557%, while the yield on the 30-year Treasury bond was at 1.985%.

The 30-year Treasury bond breached the 2% threshold for the first time in its history overnight. The historic drop in long-term U.S. bond yields comes less than 24 hours after the closely watched 10-year Treasury note and the 2-year inverted. The inversion of this key part of the yield curve has previously been a reliable indicator of economic recessions.

The stock market took a huge hit in the previous session, with the Dow plunging 800 points in its fourth-largest point drop ever to a two-month low. The sell-off exacerbated an extensive flight-to-safety into government securities.

Markets were further shaken early Thursday after China said it has to take necessary counter-measures to the latest U.S. tariffs on $300 billion of Chinese goods. The ministry also said the U.S. tariffs violate a consensus reached by leaders of two countries and get off the right track of resolving disputes via negotiation.

At times of market turbulence, investors tend to flee to assets expected to either retain or increase in value — such as gold, the Japanese yen and government bonds. These safe-haven assets are typically sought to limit one's exposure to losses in the event of a sharp market downturn.

Recession fears

It comes at a time when market participants are worried about a protracted U.S.-China trade war, geopolitical tensions and uncertainty over Brexit. Economic data in China and Germany this week also suggested a faltering global economy.

Stateside, investors are likely to closely monitor U.S. retail sales data for July at around 8:30 a.m. ET. The figures are thought to serve as an indicator of the strength of the world's largest economy.

The latest weekly jobless claims, industrial production data for July and business inventories for June are among some of the other data releases set to follow slightly later in the session.

The U.S. Treasury is set to auction $55 billion in 4-week bills and $40 billion in 8-week bills on Thursday.

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https://www.cnbc.com/2019/08/15/us-bonds-30-year-treasury-yield-falls-below-2percent-for-first-time-ever.html

2019-08-15 06:49:40Z
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