US Treasuries finish down

US Treasury debt succumbed to mild profit-taking on Friday but the market was still higher on the week as investors reassessed the need for more interest rate hikes.
Benchmark 10-year note yields stood 0.1 percentage point lower than they did at Monday's open as benign inflation data earlier in the week suggested the Federal Reserve need be in no rush to raise interest rates.
"There has not been significant push-through of energy price increases which has been feared by many," said Lynn Reaser, chief economist at Banc of America Capital Market. "It would suggest that the further increase in rates could be indeed limited to one or two rate hikes."
That was a relief for a bond market that had started to fear that not only would the Fed bring rates up twice more to 5 percent by mid-year, but that it could also move further if economic data continued to be strong.
Still, the market's rally led to some retracing on Friday, leaving 10-year notes off 6/32 in price for a yield of 4.67 percent, compared with 4.65 percent on Thursday.
Friday's data was relatively inconclusive, with a rise in February industrial production matching forecasts and an unexpected decline in consumer sentiment eliciting little reaction.
Two-year notes dipped 1/32 to yield 4.65 percent from 4.62 percent, while five-year notes ticked down 3/32 to yield 4.62 percent.
The 30-year bond fell 11/32 to yield 4.72 percent from 4.70 percent.
Traders also reported the selling of German Bunds overseas spilled over into Treasuries.
Investment banks had started ratcheting up their rate forecasts for the European Central Bank amid increasing signs of hawkishness from policy officials there.
Such a tendency was also having a negative impact on the dollar, with foreign exchange dealers fearing that the greenback's long-standing interest rate advantage over those of its industrialised counterparts would begin to fade.
The US currency fell to its lowest in seven weeks against the euro, even though Friday's data was inconclusive for the interest rate outlook.
Data on US industrial output showed cold weather in February boosted overall output 0.7 percent, in line with forecasts and up from a downwardly revised 0.3 percent decline in January.
Warming temperatures this month apparently were no boost to consumer sentiment, though. The University of Michigan's confidence index held steady at 86.7 in mid-March, which was below analysts' median forecast of 88.0.