FX.co ★ Treasuries Show Strong Move To The Upside

Following a flat close in the previous session, Treasury bonds saw a significant upward trend in trading on Friday. Bond prices experienced early increases and maintained a strong footing throughout the entire session, resulting in the yield on the benchmark ten-year note sliding 5.3 basis points to 4.218 percent. This marks the fourth consecutive session close with a decline for the ten-year yield, since hitting a three-month closing high on Monday.

The positive performance in Treasury bonds comes from traders' optimistic forecasts for interest rates. This optimism sprung from the Federal Reserve’s recent announcement on monetary policy. There is still some uncertainty regarding the timing of the first rate, but the possibility of a quarter-point rate cut in June has increased to 66.5 percent, according to data from the CME Group’s FedWatch Tool.

Despite the buoyant trading, overall activity remained somewhat subdued. A lack of significant U.S. economic data led some traders to hold back. Trading in the coming week could be influenced by responses to reports concerning new home sales, orders for durable goods, consumer confidence, and pending home sales.

It should be noted that even though a report containing personal income, spending, and important inflation readings preferred by the Federal Reserve is slated to be published, it will be released when markets are closed for Good Friday.