By Ben Eisen, MarketWatch
NEW YORK (MarketWatch) — Treasury prices inched lower in holiday-shortened trading on Friday, putting the market on track for monthly losses as it prepares for data next week that could help dictate the direction of the Federal Reserve’s monetary policy.
Investors have been on alert for signals of when the Fed could begin to scale back the pace of its bond-buying stimulus program and pivot toward its guidance on the direction of interest rates. The central bank has said that will depend on data, which increases the focus on November’s jobs report due next Friday.
Meanwhile, a post-Thanksgiving lull in activity is moderating market movements, according to John Briggs, head of cross asset strategy at RBS. The market observes a recommended close at 2 p.m. Eastern.
“It’s a slow, sleepy open for the Treasury market and for strategists whose alarm interrupted a nice, tryptophan induced slumber,” Briggs said in a note.
Ahead of next week’s data, investors have been taking bets off the table. The 10-year note 10_YEAR +1.06% yield, which moves inversely to price, was up 2.5 basis points on the day at 2.765%. That put the benchmark note yield on track to rise roughly 20 basis points in November, its first month of rising yields since August.
The 30-year bond 30_YEAR +0.50% yield, rose 2.5 basis points to 3.840%, and the 5-year note 5_YEAR +1.32% yield rose 2 basis points to 1.385%.
Aside from the jobs report next week, the Treasury market will focus on a slew of data due to hit the wires. That includes an Institute for Supply Management manufacturing report on Monday and an ISM non-manufacturing report on Wednesday. New home sales reports are due out on Wednesday, as are ADP employment data, which gauges private-sector payrolls growth and may contain clues about the nonfarm payrolls report. A revision to gross domestic product is due out Thursday. See the full calendar here.
