After ending the previous session modestly lower, treasuries moved back to the upside during the trading day on Friday.
Bond prices moved higher early in the session and remained positive throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, slipped 1.8 basis points at 1.091 percent.
Treasuries benefited from their appeal as a safe haven amid uncertainty about President Joe Biden's proposed $1.9 trillion coronavirus relief package.
Moderate Republican Senators Mitt Romney and Lisa Murkowski have both expressed skepticism about more stimulus.
Romney and Murkowski both pointed to the recently approved $900 billion stimulus and raised questions about whether more relief is needed.
Democrats could attempt to pass a new stimulus bill without Republican support by the so-called reconciliation process, which only requires a majority.
However, Democratic Senator Joe Manchin has also expressed concerns about the cost of increasing the size of direct payments to individuals to $2,000 from $600.
Traders largely shrugged off a report from the National Association of Realtors showing an unexpected rebound in existing home sales in the month of December.
NAR said existing home sales climbed by 0.7 percent to an annual rate of 6.76 million in December after tumbling by 2.2 percent to a revised rate of 6.71 million in November.
The rebound surprised economists, who had expected existing home sales to slump by 2.1 percent to a rate of 6.55 million from the 6.69 million originally reported for the previous month.
With the unexpected monthly increase, existing home sales in December were up by 22.2 percent compared to the same month a year ago.
"Home sales rose in December, and for 2020 as a whole, we saw sales perform at their highest levels since 2006, despite the pandemic," said Lawrence Yun, NAR's chief economist.
He added, "What's even better is that this momentum is likely to carry into the new year, with more buyers expected to enter the market."
The Federal Reserve's monetary policy decision may attract attention next week along with reports on consumer confidence, durable goods orders, new home sales, and personal income and spending.
Bond traders are also likely to keep an eye on the results of the Treasury Department's auctions of two-year, five-year and seven-year notes.
