The 10-year Treasury yield was consistently above 2% on Friday as investors digested the previous session’s inflation data and the Russian-Ukrainian conflict.
The benchmark 10-year Treasury bond yield rose 1 basis point to 2.016% at 11:00 am ET. The 30-year Treasury yield fell 1 basis point to 2.39%. Yields vary inversely with prices, and 1 basis point equals 0.01%.
The 10-year bond yield topped 2% on Thursday after higher-than-expected inflation. The consumer price index rose 7.9% year-on-year to February, reaching its highest level since 1982 and exceeding an expected increase of 7.8%.
Despite lingering concerns about higher inflation, yields slipped Friday morning. The war between Russia and Ukraine has affected investors’ appetite for riskier assets like stocks and forced them to seek safer investments instead, including bonds.
Talks between Russia and Ukraine were halted on Thursday as foreign ministers from both countries made no progress on a possible ceasefire agreement.
Discussions began a day after Russian troops bombed a maternity hospital in Mariupol, killing three people, including one child, according to Ukrainian authorities.
Treasury Secretary Janet Yellen said Thursday she expects the Russian-Ukrainian war to fuel sustained inflation, foreseeing prices to remain high for another year.
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Thanos Papasavvas, founder and chief investment officer of ABP Invest, told CNBC’s Squawk Box Europe on Friday that his firm believes “inflation is here to stay.”
He explained that globalization, which has driven prices down, is receding. This means that “prices and uncertainty will be higher going forward,” he said.
“So we have inflation, we think that rates will continue to rise, there is a risk of stagflation – so this is not good,” Papasavvas said.
There are no auctions scheduled on Friday.
– Chloe Taylor of CNBC contributed to this market report.