U.S. Treasury yields fell Thursday in holiday-thinned trading as investors cast their eyes to the brighter outlook for next year.
The U.S. bond market will close early today at 2 p.m. ET and shutter on Friday in observance of Christmas.
What are Treasurys doing?
The 10-year Treasury note yield
TMUBMUSD10Y,
0.943%
fell 2.2 basis points to 0.933%, while the 2-year note rate
TMUBMUSD02Y,
0.120%
was steady at 0.121%. The 30-year bond yield
TMUBMUSD30Y,
1.675%
slid 2.4 basis points to 1.674.
What’s driving Treasurys?
Washington lawmakers were still haggling over a pandemic relief package on Monday, after President Donald Trump said he wanted the bill amended to include more generous direct checks to individuals.
On Thursday, House Republicans blocked a bill proposed by Democrats that would have sent $2,000 checks to individuals as part of the coronavirus financial aid package.
Negotiators agreed on a Brexit trade deal on Thursday before the Dec. 31 deadline. The news will cap years of uncertainty over the post-Brexit future of the U.K.-EU economic relationship.
Investors said they were now looking ahead to next year where the hope is a resolution to geopolitical concerns and widespread vaccine distribution will bolster the U.S. economic recovery.
What did market participants say?
“The 1% upper bound on the 10-year note is a line the doom and gloom crowd, and the ‘grab for yield’ investors, are likely to defend for some time, especially with lockdowns expanding in Europe and in some Asian countries,” said Steven Ricchiuto, chief U.S. economist at Mizuho.
