After an initial upwards movement, treasuries saw a modest decline during Thursday's trading session.
Bond prices retreated from their early peaks and hovered around the unchanged mark before dipping into negative territory. Consequently, the yield on the benchmark ten-year note, which inversely correlates with its price, increased by 2.1 basis points to settle at 4.377 percent.
This rise in the ten-year yield marks a recovery following Wednesday's drop to its lowest closing level in over a month.
The slight pullback in treasuries likely indicates profit-taking after the previous session's rally, driven by consumer prices rising less than anticipated in April.
Such data has fueled renewed optimism about potential interest rate cuts by the Federal Reserve in the months ahead.
Further bolstering interest rate sentiment, the Labor Department reported a decline in initial jobless claims for the week ended May 11th.
According to the Labor Department, initial jobless claims fell to 222,000, a decrease of 10,000 from the prior week's revised count of 232,000.
Economists had forecasted a dip in jobless claims to 220,000 from the previously recorded 231,000.
However, positive sentiment was tempered by another Labor Department report revealing U.S. import prices surged more than expected in April.
According to the report, import prices rose by 0.9 percent in April, following an upwardly revised 0.6 percent increase in March.
Economists had predicted a 0.3 percent rise in import prices, compared to the originally reported 0.4 percent increase for the previous month.
The annual growth rate of import prices accelerated to 1.1 percent in April from 0.4 percent in March, marking the highest year-over-year increase since December 2022.
A separate report from the Federal Reserve indicated that U.S. industrial production remained flat in April, with a surge in utility output balanced by declines in mining and manufacturing outputs.
The Fed reported that industrial production was unchanged in April after a downwardly revised 0.1 percent increase in March.
Economists had anticipated a 0.1 percent uptick in industrial production, compared to the initially reported 0.4 percent increase for the prior month.
Following a series of U.S. economic data releases over the past two days, Friday's economic calendar is relatively light. However, the Conference Board's report on April's leading economic indicators may still garner attention.
