Stronger-than-expected services activity and Treasury buyback adjustments push yields higher across the curve.
US Treasury yields rose across the curve as robust services sector data offset the impact of a Treasury buyback program. The 2-year yield increased 5 bps to 4.24%, while the 10-year yield climbed nearly 3 bps to 4.474%. The 30-year bond yield gained 2.5 bps, closing at 5.276%, despite the Treasury’s plan to raise long-end purchases from $2 billion to $4 billion.
The S&P Global Services PMI for August surpassed estimates, signaling solid business activity, while manufacturing growth slowed. Factory prices faced pressure from energy cost spikes linked to US-Iran tensions. Markets now await Monday’s Iranian sanctions announcement, the PCE report, and Fed Chair Warsh’s Jackson Hole remarks.
The US Dollar Index (DXY) remained nearly flat, dipping 0.02% to 98.84, reflecting muted immediate reaction to the data.