U.S. Treasuries plunge ahead of 10-year auction, initial jobless claims

The U.S. Treasuries plunged Thursday ahead of the 10-year auction, scheduled to be held later in the day. Also, investors are awaiting the release of initial jobless claims data, besides, the Federal Open Market Committee (FOMC) member James Bullard’s speech scheduled for late today.

The yield on the benchmark 10-year Treasury jumped 2-1/2 basis points to 2.36 percent, the super-long 30-year bond yield surged 3 basis points to 2.99 percent while the yield on short-term 2-year note pushed nearly 1/2 basis point higher to 1.16 percent.

Initial jobless claims for the week ending January 28 eased to 246k, declining more than expected (Barclays/consensus: 250k). The four-week moving average edged higher, to 248k, mostly on account of the jump in claims in the previous week. Continuing claims for the week ending January 21 also eased, to 2064k from an upwardly revised 2103k.

Further, non-farm payrolls in the U.S. rose in January, coming in above the market expectations. Non-farm payrolls increased 227,000, as compared with the 180,000 projected by the market. On the contrary, the jobless rate rose slightly by 0.1 percentage points to 4.8 percent as household employment pulled back in spite of some re-entry to the labor force.

The influx of people into the labor force increased the participation rate by 0.2 percentage points to 62.9 percent sequentially. Several wider measures of joblessness also rose on the increased labor force participation. The employment ratio was also up by 0.2 percentage points, matching the post-recession high.

Meanwhile, the S&P 500 Futures rose 0.22 percent to 2,295.25 by 11:30GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained neutral at 67.84 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex