2024.03.0619:12:00UTC+00Ten-Year Yield Falls To Lowest Level In A Month

Treasuries saw some strength during trading on Wednesday, extending the strong upward move seen in the previous session.

Bond priced moved higher early in the session and remained firmly positive throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.3 basis points to 4.104 percent.

The ten-year yield added to the 8.2 basis point slump seen on Tuesday, falling to its lowest closing level in a month.

The continued strength among treasuries came as traders reacted to congressional testimony by Federal Reserve Chair Jerome Powell.

Powell told the House Financial Services Committee it will likely be appropriate for the Fed to begin lowering interest rates at "some point this year," although he reiterated officials need "greater confidence" inflation is moving sustainably toward 2 percent.

The Fed Chief described the economic outlook as "uncertain" and said progress towards the Fed's 2 percent inflation objective is "not assured."

"Reducing policy restraint too soon or too much could result in a reversal of progress we have seen in inflation and ultimately require even tighter policy to get inflation back to 2 percent," Powell said.

He added, "At the same time, reducing policy restraint too late or too little could unduly weaken economic activity and employment."

Powell said future interest rate decisions will be based on careful assessment of the incoming data, the evolving outlook, and the balance of risks.

Meanwhile, a report released by payroll processor ADP showed private sector employment in the U.S. increased by slightly less than expected in the month of February.

ADP said private sector employment rose by 140,000 jobs in February after climbing by an upwardly revised 111,000 jobs in January.

Economists had expected private sector employment to grow by 150,000 jobs compared to the addition of 107,000 jobs originally reported for the previous month.

Powell is due to deliver his second day of testimony on Capitol Hill on Thursday, while reports on weekly jobless claims and the U.S. trade deficit may also impact trading.