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U.S. Treasury yields rose on early Tuesday’s trade as economic data from across the globe pointed to a continued international economic expansion, despite rising COVID-19 pandemic expected to intensify in the coming weeks.
What are Treasurys doing?
The 10-year Treasury note yield TMUBMUSD10Y, 0.876% rose 1.8 basis points to 0.860%, while the 30-year bond yield TMUBMUSD30Y, 1.619% climbed 2.5 basis points to 1.596%. The 2-year note rate TMUBMUSD02Y, 0.156% edged 0.4 basis point higher to 0.151%.
What’s driving Treasurys?
The eurozone manufacturing purchasing managers’ index fell to 53.8 in November, from 54.8 in October, but the report also showed factories were optimistic over future demand.
The continued expansion of economic activity has given hope to analysts that the eurozone economy, which has contended with a slew of new COVID-19 restrictions, will avoid a downturn of the scale of the second-quarter hit this year.
In China, the official manufacturing purchasing managers’ index last month rose to 52.1 last month, staying in growth territory for the last nine months. Any reading above 50 represents an increase in factory activity
In the U.S., the Institute for Supply Management will release its gauge of manufacturing activity in November at 10 a.m. ET. Construction spending numbers in October will come out at the same time.
Federal Reserve Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin will give testimony in front of the Senate. Powell is expected to call for more fiscal spending to cushion the economic damage from re-accelerating pandemic.
What did market participants say?
“It has been a full day for data releases overnight, headlined by what were mostly positive results for manufacturing PMI releases,” said Simon Deeley, a rates analyst at RBC Dominion Securities.
