Treasuries Close Roughly Flat Following Choppy Trading Day

(RTTNews) - Treasuries showed a lack of direction over the course of the trading session on Friday before ending the day roughly flat.

Bond prices spent the day bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 1.792 percent.

With the slight uptick on the day, the ten-year yield climbed off the one-month closing low set in the previous session.

The choppy trading shown by treasuries came as traders digested some key U.S. economic data, including the Labor Department's closely watched monthly jobs report.

The report said non-farm payroll employment climbed by 215,000 jobs in March after jumping by an upwardly revised 245,000 in February. Economists had expected an increase of about 210,000 jobs.

Nonetheless, the Labor Department also said the unemployment rate inched up to 5.0 percent in March from 4.9 percent in February. The unemployment rate had been expected to remain unchanged.

The unexpected uptick by the unemployment rate came as more people entered the workforce, as the labor force jumped by 396,000 people while household employment increased by 246,000 people.

Meanwhile, a separate report from the Institute for Supply Management showed a stronger than expected rebound in manufacturing activity in March.

The ISM said its purchasing managers index climbed to 51.8 in March from 49.5 in February, with a reading above 50 indicating growth in the manufacturing sector. Economists had expected the index to inch up to 50.5.

With the bigger than expected increase, the index indicated the first month of growth in the manufacturing sector since last August.

The University of Michigan also reported a smaller than previously estimated drop in consumer sentiment in March, while the Commerce Department reported an unexpected decrease in construction spending in February.

James Smith, Developed Markets Economist at ING, said, "Taken as an aggregate, today's U.S. data is fairly encouraging and crucially, will give the data-dependent FOMC more confidence about the direction of the U.S. economy."

The economic calendar for next week is relatively quiet, but traders are likely to keep an eye on reports on the trade deficit, service sector activity, and factory orders.

The Federal Reserve is also due to release the minutes of its latest monetary policy meeting, which could shed some light on the outlook for interest rates.