10-year Treasury yield edges higher as investors dissect conflicting economic data points

The benchmark 10-year Treasury yield edged higher on Thursday as investors assessed conflicting economic data and several speeches from Federal Reserve policymakers helping to point the way on the future direction of interest rates.

The 10-year Treasury yield rose about 3 basis points to 4.434%, while the yield on the 2-year Treasury gained nearly 4 basis points 4.344%.

Yields and prices move in opposite directions, and one basis point equals 0.01%.

Several economic reports out Thursday offered conflicting signals about the state of the economy, today and in the future. Weekly claims for unemployment insurance dropped to 213,000 from 220,000 last week and Wall Street's estimate of 219,000, but continuing claims for jobless insurance climbed to 1.908 million from 1.872 million last week, 25,000 more than the Street's estimate of 1.883 million.

The Philadelphia Federal Reserve manufacturing index of activity in the region slowed to -5.5 in November against economists' estimate of +6.9 and October's +10.3, while a Kansas City Federal Reserve survey showed November manufacturing activity in the region — encompassing Omaha to Denver to Oklahmoa City — fell slightly, even as expectations for future activity rose.

And the Conference Board Leading Economic Index dropped 0.4% in October 2024 to 99.5 after a revised 0.3% decline in September. In the six months from April to October 2024, the LEI fell by 2.2%, slightly more than its 2.0% decline over the previous six month periods.

"The largest negative contributor to the LEI's decline came from manufacturer new orders, which remained weak in 11 out of 14 industries," said the Conference Board's senior manager for business cycle indicators Justyna Zabinska-La Monica. "In October, manufacturing hours worked fell by the most since December 2023, while unemployment insurance claims rose and building permits declined, partly reflecting the impact of hurricanes in the Southeast ... Apart from possible temporary impacts of hurricanes, the U.S. LEI continued to suggest challenges to economic activity ahead. "

At the same time, October seasonally adjusted existing home sales grew to an annual rate of 3.960 million, higher than the Street's forecast of 3.925 million and September's rate of 3.840 million.

Fixed income investors are also monitoring remarks by Fed policymakers for hints as to how the central bank may direct interest rates later this fall and winter, having already lowered rates in both September and November.

Chicago Federal Reserve President Austan Goolsbee said Thursday that he is looking through recent fluctuations in employment and inflation data and still sees the need for lower interest rates ahead.

Cleveland Fed President Beth Hammack, Kansas City Fed President Jeff Schmid and Fed Vice Chair for Supervision Michael Barr are also scheduled to deliver remarks about the U.S. economy on Thursday.

Fed Governor Michelle Bowman warned on Wednesday that the fight to bring inflation back to the central bank's 2% target "appears to have stalled."

Also hanging over the bond market are President-elect Donald Trump's potential picks for Treasury secretary, with concerns tied to the candidates' experience and policy beliefs, as well as the latest developments in the Russia-Ukraine war, with tensions between Washington and Moscow mounting this past week as Moscow and Kyiv exchanged missile attacks.

— CNBC's Jeff Cox contributed to this report.