Treasurys Steady After Recent Gains as Hurricane Irma Looms

By Sam Goldfarb Features Dow Jones Newswires

U.S. government bonds were bouncing between gains and losses Friday, as traders prepared for Hurricane Irma and the potential for more missile tests by North Korea.

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In recent trading, the yield on the benchmark 10-year Treasury note was 2.061%, according to Tradeweb, unchanged from Thursday. Yields rise when bond prices fall.

After falling Thursday, Treasury yields continued to decline in the overnight session before perking up at the start of U.S. trading.

Yields have reached new 2017 lows this week, reflecting investors' concerns about geopolitics and natural disasters, as well as continued focus on soft inflation data.

Even with parts of the U.S. still reeling from Hurricane Harvey, authorities have ordered more than 650,000 people to evacuate the Miami area in preparation for a potential direct hit from Hurricane Irma on Saturday.

There has also been speculation that North Korea could soon launch another intercontinental ballistic missile, raising further questions about how the U.S. and other countries can halt the progress of its nuclear program.

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"What's going to happen with North Korea, what's going to happen with the hurricanes, it's just an unknown, and people are voting with buying of Treasurys," said Thomas Roth, managing director in the rates trading group at MUFG Securities Americas Inc.

One immediate threat to the economy -- the possibility of a government shutdown or breach of the federal debt limit -- was poised to get a short-term solution Friday, as the House neared a vote on a bill that would fund the government and raise the debt limit until December.

Concern that Congress could fail to pass such a measure has helped bolster most Treasury debt recently, though it has hurt demand for short-term bills that mature right after the government would reach the limit of its borrowing authority.

Write to Sam Goldfarb at sam.goldfarb@wsj.com

(END) Dow Jones Newswires

September 08, 2017 10:50 ET (14:50 GMT)