U.S. Treasury yields continued to move lower on Friday as investors weighed the state of the U.S. economy after fresh developments in trade negotiations and several economic data points were published throughout the week.
At 4:40 a.m. ET, the 10-year Treasury yield declined over 4 basis points to 4.411%, and the 2-year Treasury yield fell more than 3 basis points to 3.942%.
One basis point is equivalent to 0.01%, and yields and prices move in opposite directions.
Investors are ending the week on an optimistic note after the U.S. and China came to a trade agreement to drop most tariffs in a temporary 90-day pause earlier this week, easing fears about a global trade war and risks to the U.S. economy.
However, concerns still remain as some companies have warned that rising costs will hit their businesses. For example, Walmart will likely have to raise prices on some items in late May due to tariffs, it said on Thursday.
Meanwhile, the inflation reading for April came in softer than expected, easing some recession fears.
Federal Reserve Chairman Jerome Powell warned on Thursday that long-term interest rates will likely be higher, given frequent policy changes affecting the economy.
“We may be entering a period of more frequent, and potentially more persistent, supply shocks — a difficult challenge for the economy and for central banks,” Powell said in prepared remarks for the Thomas Laubach Research Conference in Washington, D.C.
Investors will also look out for housing starts data and the University of Michigan’s consumer sentiment survey on Friday.
