Treasury Yields Decrease

Published April 18, 2025

Treasury yields edged down throughout the week as the markets weighed in on the latest retail sales data showing consumer spending remained robust. Yields continued to decline toward the end of the week, even as a drop in unemployment claims pointed to ongoing strength in the U.S. labor market.

On Thursday, the Commerce Department reported that retail sales for March rose 1.4%. This exceeded Wall Street’s projections of a 1.2% increase and was higher than the 0.2% increase experienced in February. Sales, excluding auto and gas, showed an increase of 0.5%, also surpassing analysts’ expectations of a 0.3% increase.

“Net, net, these are simply blow out numbers on March retail sales where the rush is on like this is one gigantic clearance sale,” said Chief Economist at FWDBONDS, Chris Rupkey. “Consumers are expecting sharply higher prices the next year and are clearing the store shelves and picking up bargains while they can.”

The benchmark 10-year Treasury note yield opened the week of April 14 at 4.49% and traded as low as 4.27% on Wednesday. The 30-year Treasury bond opened the week at 4.87% and traded as low as 4.73% on Wednesday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased by 9,000 to 215,000 for the week ending April 12. The reported claims were below analysts’ expectations of 225,000. Continuing claims rose by 41,000 to 1.89 million.

“Overall, the claims report does not show any current evidence of layoffs materializing,” said U.S. economist at Jefferies LLC, Thomas Simons. “Despite very negative business sentiment and the actions taken and recommended by the [Department of Government Efficiency], we do not see evidence that businesses are reducing headcount in any significant scale."

The 10-year Treasury note yield finished the week of April 14 at 4.33% while the 30-year Treasury note yield finished the week at 4.80%.