WASHINGTON (dpa-AFX) - Treasuries have trended lower over the past few sessions but showed a substantial move back to the upside during trading on Friday.
Bond prices surged early in the session and climbed even more firmly into positive territory as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, plunged 4.255 basis points to 4.255 percent.
Treasuries benefitted from the appeal as a safe haven comes amid concerns about the outlook for the economy following the latest data, including the Federal Reserve's preferred readings on inflation.
While a Commerce Department report showed consumer prices increased in line with economist estimates, core consumer prices rose by slightly more than expected.
The Commerce Department said its personal consumption expenditures (PCE) price index rose by 0.3 percent in February, matching the increases seen in the two previous months as well as economist estimates.
The annual rate of growth by the PCE price index was 2.5 percent in February, unchanged from January and in line with expectations.
Meanwhile, the report said the core PCE price index, which excludes food and energy prices, climbed by 0.4 percent in February after rising by 0.3 percent in January. Economists had expected another 0.3 percent increase.
The annual rate of growth by the core PCE price index also accelerated to 2.8 percent in February from an upwardly revised 2.7 percent in January.
Economists had expected the year-over-year growth by the core PCE price index to tick up to 2.7 percent from the 2.6 percent originally reported for the previous month.
The report also showed real personal spending, which excludes price changes, inched up by just 0.1 percent in February after sliding by 0.6 percent in January.
'The acceleration in core PCE inflation and the softness in consumer spending is an unfavorable mix of economic data,' said Nationwide Chief Economist Kathy Bostjancic.
She added, 'The data support our view that downside risks to the economy are emerging, but with inflation heating up, the Fed for now will maintain its wait-and-see approach.'
The University of Michigan also released revised data showing consumer sentiment deteriorated by more than previously estimated in March.
The report also showed year-ahead and long-run inflation expectations surged by more than previously estimated during the month.
The closely watched monthly jobs report is likely to be in the spotlight next week, while reports on manufacturing and service sector activity may also attract attention.
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