MW: Treasurys rise as data show consumer prices tame
By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) -- Treasury prices edged up Friday, pushing yields down to the lowest this month, after government data on consumer prices eased concerns about the potential for rising U.S. inflation.
Yields on 10-year notes (UST10Y 3.60, 0.00, 0.00%) fell 2 basis points, or 0.02 percentage point, to 3.58%.
Yields on 2-year notes (UST2YR 1.08, -0.07, -5.92%) declined 1 basis point to stand at 1.08%.
Bond prices move inversely to their yields.
The Labor Department said the consumer price index was unchanged in July, after seasonal adjustments. The flat reading was as expected by analysts surveyed by MarketWatch.
Compared to a year ago, prices were down 2.1%, the sharpest annual decline since 1950. See more on CPI.
Excluding food and energy prices, the index rose 0.1% for July from June, also as had been forecast.
"The market is getting a bid on this friendlier-than-expected CPI report," said David Ader and Ian Lyngen, government-bond strategists at brokerage CRT Capital Group.
Bonds also maintained gains after the Federal Reserve reported that U.S. industrial output rose in July for the first time since October, led by a resurgent auto sector.
The seasonally adjusted output of the nation's factories, mines and utilities increased 0.5% in July, reversing course after a 0.4% decline in June. See Economic Report.
