2018.04.2315:19:00UTC+00Treasuries Show Another Move To The Downside

Extending a recent downward trend, treasuries moved to the downside over the course of the trading session on Monday.

Bond prices moved lower early in the session and remained stuck in negative territory throughout the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.2 basis points to 2.973 percent.

With the increase on the day, the ten-year yield closed higher for the fourth consecutive session, reaching its highest closing level in over four years.

The continued weakness among treasuries came as traders expect rising inflation to lead the Federal Reserve to raise interest rates.

On the U.S. economic front, the National Association of Realtors released a report showing a bigger than expected increase in existing home sales in the month of March.

NAR said existing home sales climbed by 1.1 percent to an annual rate of 5.60 million in March after surging up by 3.0 percent to a rate of 5.54 million in February. Economists had expected existing home sales to edge up by 0.2 percent.

Existing home sales rose for the second consecutive month but are still down by 1.2 percent compared to the same month a year ago.

"Robust gains last month in the Northeast and Midwest - a reversal from the weather-impacted declines seen in February - helped overall sales activity rise to its strongest pace since last November at 5.72 million," said NAR chief economist Lawrence Yun.

He added, "The unwelcoming news is that while the healthy economy is generating sustained interest in buying a home this spring, sales are lagging year ago levels because supply is woefully low and home prices keep climbing above what some would-be buyers can afford."

Trading on Tuesday may be impacted by reaction to reports on home prices, consumer confidence and new home sales.

Bond traders are also likely to keep an eye on the results the Treasury Department's auction of $32 billion worth of two-year notes.