AGL 37.98 Increased By ▲ 0.48 (1.28%)
AIRLINK 220.00 Increased By ▲ 2.62 (1.21%)
BOP 10.81 Increased By ▲ 0.34 (3.25%)
CNERGY 7.85 Increased By ▲ 0.41 (5.51%)
DCL 9.15 Increased By ▲ 0.14 (1.55%)
DFML 40.78 Decreased By ▼ -0.56 (-1.35%)
DGKC 104.92 Decreased By ▼ -1.14 (-1.07%)
FCCL 36.58 Decreased By ▼ -0.94 (-2.51%)
FFBL 88.94 No Change ▼ 0.00 (0%)
FFL 17.93 Increased By ▲ 0.67 (3.88%)
HUBC 130.89 Increased By ▲ 1.18 (0.91%)
HUMNL 14.67 Increased By ▲ 0.65 (4.64%)
KEL 5.60 Increased By ▲ 0.19 (3.51%)
KOSM 7.38 Increased By ▲ 0.21 (2.93%)
MLCF 45.94 Decreased By ▼ -0.44 (-0.95%)
NBP 66.92 Increased By ▲ 1.26 (1.92%)
OGDC 227.26 Increased By ▲ 1.80 (0.8%)
PAEL 43.85 Decreased By ▼ -0.67 (-1.5%)
PIBTL 9.38 Increased By ▲ 1.00 (11.93%)
PPL 203.55 Increased By ▲ 4.59 (2.31%)
PRL 44.32 Increased By ▲ 3.86 (9.54%)
PTC 27.27 Decreased By ▼ -0.03 (-0.11%)
SEARL 104.46 Decreased By ▼ -1.83 (-1.72%)
TELE 9.70 Increased By ▲ 0.07 (0.73%)
TOMCL 35.69 Increased By ▲ 0.04 (0.11%)
TPLP 15.64 Increased By ▲ 0.57 (3.78%)
TREET 28.09 Increased By ▲ 2.46 (9.6%)
TRG 70.67 Increased By ▲ 0.22 (0.31%)
UNITY 34.54 Increased By ▲ 0.99 (2.95%)
WTL 1.78 Decreased By ▼ -0.05 (-2.73%)
BR100 12,387 Increased By 2.7 (0.02%)
BR30 38,706 Increased By 316.8 (0.83%)
KSE100 115,127 Decreased By -132.1 (-0.11%)
KSE30 36,182 Decreased By -117.5 (-0.32%)

US Treasury yields fell on Friday, with benchmark and long-dated US yields hitting their lowest in more than three weeks, as data showing the US economy contracted in the first quarter supported views of a later Federal Reserve interest-rate hike. The government slashed its gross domestic product estimate to show GDP shrinking at a 0.7 percent annual rate instead of the 0.2 percent growth it estimated last month. Still, the reading was a touch better than economists' expectations for a drop of 0.8 percent.
The data supported an expectation that the Fed would have to consider signs of weakness in the US economy before raising interest rates for the first time in nearly a decade. Fed rate hikes are expected to hurt bond prices, which move inversely to yields. Besides the headline GDP figure, analysts said details such as the slight decrease in the core personal consumption expenditures gauge to 0.8 percent spurred demand for Treasuries.
"The PCE core part of the GDP report was a reminder that inflation is still quite weak, and that adds to a bid in the bonds," said market strategist Lou Brien of DRW Trading in Chicago. He said renewed weakness in inflation could delay Fed rate hikes. US 30-year Treasury yields hit their lowest in 3-1/2 weeks at 2.84 percent. Long-dated bonds benefited from institutional investors' purchases for the purpose of month-end portfolio readjustments.
"Even small repositioning could have led to this marginal rally in bonds" given a lack of liquidity in the bond market, said portfolio manager Sam Diedrich of PAAMCO in Irvine, California. US 30-year Treasury yields were set for their biggest weekly decline since mid-March of about 12 basis points, while benchmark 10-year yields were set for their biggest weekly decline since the week ended April 3 of about 11 basis points. Benchmark yields also hit their lowest level in 3-1/2 weeks, at 2.09 percent. US two-year notes, which are sensitive to Fed rate hike expectations, hit their lowest level in a week at 0.6050 percent.
Benchmark and 30-year yields were still set to post their second straight monthly rise in yields, however. Price action was muted near the end of trading. US 30-year Treasuries were last up 4/32 in price to yield 2.88 percent, from a yield of 2.89 percent late Thursday. US 10-year notes rose 2/32 in price to yield 2.12 percent, from a yield of 2.13 percent late Thursday.

Copyright Reuters, 2015

Comments

Comments are closed.