U.S. Treasuries plunge on expectations of fall in initial jobless claims; 10-year auction eyed

The U.S. Treasuries plunged on expectations of a fall in the country’s initial jobless claims, scheduled to be released on July 19, besides the 10-year auction, due to be held on the same day.

The yield on the benchmark 10-year Treasury, jumped 1-1/2 basis points to 2.28 percent, the super-long 30-year bond yields climbed nearly 1 basis point to 2.86 percent and the yield on short-term 2-year note traded nearly 1/2 basis point higher at 1.35 percent by 11:50GMT.

USD remained under pressure amid heightened market uncertainty over the US administration’s ability to implement key campaign promises including healthcare and tax reform.

A downward reassessment in short-term Fed rate hike expectations following the more dovish-than-expected tone of US Fed Chair Janet Yellen at last week’s semi-annual testimony and disappointing US June inflation and retail sales data also continued to weigh on market sentiment towards USD. Turning to core government bonds, yields remained off recent multi-month highs.

Data wise, today the US housing starts and building permits for June are expected, though they are unlikely to be a game-changer for markets ahead of Thursday’s ECB monetary policy meeting.

Meanwhile, the S&P 500 Futures traded 0.05 percent higher at 2,459.00 by 11:50GMT, while at 11:00GMT, the FxWirePro's Hourly Dollar Strength Index remained slightly bearish at -98.87 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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