US Treasuries rise modestly on weaker than expected non-farm productivity data

The US Treasuries saw continued upward pressure across much of the curve following the release of weaker than expected 2Q16 non-farm productivity data. The yield on the benchmark 10-year Treasury note fell 1 basis point to 1.54 percent mark and the yield on short-term 2-year note dipped ½ basis point to 0.71 percent by 12:30 GMT.

The preliminary second quarter US Labour Department productivity report revealed an overall decrease of -0.5 percent, well below market expectations for a +0.5% increase, as compared to the -0.6 percent reading seen in the first quarter of 2016.

Investors now await a light flow of data on Wednesday, highlighted by JOLTS job openings, EIA petroleum status and Treasury budget release, coupled with a 10-year note auction later in the session.

Meanwhile, the S&P 500 Futures traded 2.75 points higher at 2,180.25 by 12:30 GMT.