U.S. Government Bonds Stable on Economic Data, Political Uncertainty

By Daniel Kruger Features Dow Jones Newswires

U.S. government bonds were stable amid mixed economic data and growing concerns about progress on the budget.

Continue Reading Below

The yield on the benchmark 10-year U.S. Treasury note yield recently was flat at 2.328% from Monday, according to Tradeweb. Bond yields fall as prices rise.

Yields slipped after Democratic congressional leaders pulled out of budget talks with President Donald Trump after the president said in a tweet he didn't see a path to a government-spending deal, raising concerns about a possible legislative fight.

Jerome Powell, President Trump's nominee to succeed Janet Yellen as chair of the Federal Reserve, also signaled in Senate testimony Tuesday the central bank is likely to raise interest rates in December.

"The price action today suggests a reasonable amount of apprehension about what's coming out of Washington," said Ian Lyngen, head of government bond strategy at BMO Capital Markets.

A mixed set of data on trade, housing prices and consumer confidence also contributed to Tuesday's moves.

Continue Reading Below

The Commerce Department Tuesday said the goods trade deficit climbed 6.5% to $68.3 billion in October, as imports of industrial supplies and consumer goods rose, while exports fell 1%. The department also said that wholesale inventories fell 0.4% in October after gaining 0.1% in September.

Home price growth accelerated in September as a strong economy boosted demand for homes and supply failed to keep pace. The S&P CoreLogic Case-Shiller National Home Price Index, which covers the entire nation, rose 6.2% in the 12 months ended in September, up from a 5.9% annual increase in August. The September figure was the fastest annual rate since June 2014.

A measure of U.S. consumer confidence rose again in November, hitting yet another 17-year high. The Conference Board on Tuesday said its index of U.S. consumer confidence increased to 129.5 in November from 126.2 in October. Economists surveyed by The Wall Street Journal had expected a November reading of 124.0.

Write to Daniel Kruger at daniel.kruger@wsj.com

(END) Dow Jones Newswires

November 28, 2017 13:35 ET (18:35 GMT)