By Greg Morcroft, MarketWatch
NEW YORK (MarketWatch) — U.S. Treasury prices traded little changed Wednesday, only slightly lower after the government reported the highest producer price inflation since January.
The yield on 10-year Treasury notes 10_YEAR +0.54% was around three basis points higher on the day at 2.25% in recent action, up from around 2.24% ahead of the data. The 30-year T-bond yield 30_YEAR +0.19% rose by around three basis points to 3.69%, versus a yield of around 3.68% before the release.
Yields move in the opposite direction of bond prices.
Producer prices rose a seasonally adjusted 0.2% in July, as a surge in tobacco prices offset a decline in energy costs, the Labor Department said Wednesday.
Excluding food and energy, the so-called core PPI rate rose 0.4%, the largest monthly increase since January.
Economists polled by MarketWatch had expected monthly increases of 0.1% and 0.2%, respectively, for the headline and core PPI rates.
In currency markets, the U.S. dollar remained weaker versus major rivals Wednesday, posting little reaction to the hotter-than-expected PPI data.
The euro EURUSD +0.56% traded at $1.4471, up 0.6% from Tuesday but little changed from around $1.4480 ahead of the data.
The dollar fetched 76.50 Japanese yen USDJPY -0.38% , down 0.4% from Tuesday but little changed from the level seen before the PPI figures came out.
