WASHINGTON (dpa-AFX) - Extending the downward trend seen over the past several sessions, treasuries moved lower during trading on Thursday.
Bond prices saw some early volatility but moved to the downside as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 2.9 basis points to 4.096 percent.
With the increase, the ten-year yield closed higher for the seventh straight session, reaching its highest closing level in over two months.
The weakness among treasuries came following the release of a highly anticipated Labor Department report showing consumer prices in the U.S. increased by slightly more than expected in the month of September.
The Labor Department said its consumer price index rose by 0.2 percent in September, matching the increase seen in August. Economists had expected consumer prices to inch up by 0.1 percent.
The report also said core consumer prices, which exclude food and energy prices, climbed by 0.3 percent for the second consecutive month. Core prices were expected to rise by 0.2 percent.
Meanwhile, the Labor Department said the annual rate of consumer price growth slowed to 2.4 percent in September from 2.5 percent in August. Economists had expected the pace of price growth to slow to 2.3 percent.
The annual rate of core consumer price growth accelerated to 3.3 percent in September from 3.2 percent in August, while economists had expected the pace of growth to remain unchanged.
The bigger than expected increase by consumer prices has further offset optimism the Federal Reserve will continue to aggressively lower interest rates in the coming months.
CME Group's FedWatch Tool is currently indicating an 84.0 percent chance the Fed will lower rates by 25 basis points next month after slashing rates by 50 basis points last month.
Following the data, Atlanta Federal Reserve President Raphael Bostic told the Wall Street Journal he was 'definitely open' to leaving interest rates unchanged in November.
A report on producer price inflation is likely to attract attention on Friday along with readings on consumer sentiment and inflation expectations.
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