Treasuries Close Roughly Flat Ahead Of Closely Watched Inflation Data

(RTTNews) - After recovering from an early move to the downside, treasuries showed a lack of direction over the course of the trading session on Thursday.

Bond prices spent most of the day lingering near the unchanged line before closing roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 4.075 percent.

The initial weakness among treasuries came after the Labor Department released a report showing first-time claims for U.S. unemployment benefits fell by much more than expected in the week ended February 14th.

The Labor Department said initial jobless claims slid to 206,000, a decrease of 23,000 from the previous week's revised level of 229,000.

Economists had expected jobless claims to slip to 225,000 from the 227,000 originally reported for the previous week.

Selling pressure waned shortly after the start of trading, however, with concerns about a potentially military conflict between the U.S. and Iran contributed to subsequent recovery.

However, traders seemed reluctant to make significant moves ahead of the release of closely watched readings on consumer price inflation on Friday. The data could have a significant impact on the outlook for interest rates.

The minutes of the Federal Reserve's latest monetary policy meeting noted a number of participants judged further rate cuts may not be warranted until there was clear indication that the progress of disinflation was firmly back on track.

While the consumer price inflation readings may be in the spotlight on Friday, traders are also likely to keep an eye on reports on fourth quarter GDP, new home sales and consumer sentiment.