Treasuries Extend Downtrend As Traders Digest ECB Stimulus

(RTTNews) - Extending the downward trend seen in recent sessions, treasuries moved notably lower over the course of the trading day on Friday.

Bond prices came under pressure in morning trading and remained firmly in the red throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, advanced 4.8 basis points to 1.977 percent.

With the increase, the ten-year yield closed higher for the third straight day, reaching its highest closing level in well over a month.

The weakness among treasuries came as traders continued to digest the European Central Bank's announcement of a package of stimulus measures on Thursday.

The ECB reduced its various interest rates by 5 or 10 basis points and expanded its monthly asset purchase program by 20 billion euros.

Traders were also reacting to an increase by the price of crude oil, with crude for April delivery climbing $0.66 to $38.50 a barrel.

The price of crude oil reached a three-month closing high, benefiting from an optimistic report from the International Energy Agency.

In its monthly report, the IEA said the price of oil may have bottomed due to lower output from the U.S. and other non-OPEC producers.

The Federal Reserve's monetary policy meeting is likely to be in focus next week, with the central bank due to announce its latest decision on Wednesday.

While the Fed is widely expected to leave interest rates unchanged, traders are likely to pay close attention to the wording of the accompanying statement.

A slew of economic data is also scheduled to be released next week, including reports on retail sales, industrial production, and producer and consumer price inflation.