As investors analyzed conflicting economic statistics on Tuesday, U.S. Treasury yields stayed largely unchanged.
The 10-year Treasury yield increased by more than 3 basis points to 4.217% at 3:57 p.m. ET. The 2-year Treasury last decreased by around 2 basis points, to 4.946%.
Prices and yields move in the inverse direction. 0.01% is one basis point.
The retail sales statistics for July exceeded expectations, showing that consumer spending is strong. The advanced retail sales report revealed a 0.7% increase from the previous month. In the meantime, a 0.4% increase was predicted by economists surveyed by Dow Jones.
In the meantime, manufacturing activity in the New York region declined in August. The Empire State Manufacturing Survey index from the New York Fed, which measures the proportion of companies reporting expansion against contraction, dropped to -19. That was far below the -1.4 Dow Jones prediction and by about 20 points below the figure from July.
Chinese economic figures that were poor also affected market sentiment. Retail sales and industrial production in the nation increased less than anticipated in July. Despite the People’s Bank of China reducing interest rates from 2.65% to 2.5%, worries about growth and the real estate market persisted.
Investors will be closely watching the release of the minutes from the Fed’s most recent meeting on Wednesday because they could provide information about the expectations of the central bank for the economy and interest rates.
There have been conflicting signals since officials’ previous gathering in July over whether there will be additional rate increases to reduce inflation and cool the economy or whether the Fed’s rate-hiking program may soon come to a stop.
Following the July Fed meeting, Jerome Powell, the head of the institution, stated that a variety of options remained on the table and that decisions about interest rates will be based on economic data.
While the producer price index came in somewhat higher than anticipated for the month of July, the consumer price index for the same month indicated that pressures from rising prices were diminishing.