2021.02.2619:26:00UTC+00Treasuries Fluctuate Before Closing Notably Higher

After moving rebounding from yesterday's weakness early in the session, treasuries fluctuated over the course of the trading day on Friday.

Bond prices pulled back off their early highs in morning trading but managed to move back to the upside in the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, slid 5.8 basis points to 1.460 percent.

With the pullback on the day, the ten-year yield gave back ground after ending the previous session at its highest closing level in a year.

Treasuries initially benefited from traders moving into bonds following the recent spike in yields, although buying interest was somewhat subdued.

The subsequent pullback by treasuries came following the release of another batch of largely upbeat U.S. economic data.

A report from the Commerce Department showed U.S. personal income skyrocketed in the month of January, reflecting the issuance of $600 stimulus checks.

The Commerce Department said personal income spiked by 10.0 percent in January after rising by 0.6 percent in December. Economists had expected personal income to soar by 9.5 percent.

The report also showed a significant rebound in personal spending, which surged up by 2.4 percent in January after falling by a revised 0.4 percent in December.

Economists had expected personal spending to jump by 2.5 percent compared to the 0.2 percent dip originally reported for the previous month.

However, treasuries eventually showed a strong move back to the upside as the report also showed inflation remained relatively tame

A reading on inflation said to be preferred by the Federal Reserve showed the annual rate of core consumer price growth ticked up to 1.5 percent in January from 1.4 percent in December.

Concerns about inflation have recently weighed on treasuries despite Fed Chair Jerome Powell's repeated assurances the central bank plans to maintain interest rates at near-zero levels for the foreseeable future.

The Labor Department's closely watched monthly jobs report is likely to be in the spotlight next week, while reports on manufacturing and service sector activity, factory orders and the U.S. trade deficit may also attract some attention.

The Federal Reserve is also scheduled to release its Beige Book, a compilation of economic evidence from the twelve Fed districts.