Treasury yields slip after Commerce Secretary offers bleak US-China trade outlook

U.S. government debt yields slipped on Thursday after the U.S. Commerce Secretary said that Washington and Beijing are “miles and miles” away from a permanent trade agreement.

The bleak outlook on the U.S.-China deliberations from Secretary Wilbur Ross added to growing concerns about a slowdown in global economic growth and spurred modest buying in the Treasury market.

The yield on the benchmark 10-year Treasury note fell to 2.709 percent at 9:44 a.m. ET, while the yield on the 30-year Treasury bond dropped to 3.032 percent. Bond yields move inversely to prices.

The European Central Bank took no action Thursday and left its benchmark interest rates unchanged. However, ECB President Mario Draghi downgraded the bank’s growth risk assessment due to multiple headwinds globally.

The central bank’s leader said that risks to the growth are now tilted to the downside.

“The risks surrounding the euro area growth outlook have moved to the downside on account of the persistence of uncertainties related to geopolitical factors and the threat of protectionism, vulnerabilities in emerging markets and financial market volatility,” Draghi said.

The ECB meeting comes less than a week before the U.S. Federal Reserve will host its two-day monetary policy meeting. No speeches are scheduled for Thursday.

The number of people seeking jobless benefits dropped last week to the lowest level since November 1969, the Labor Department reported Thursday. The government said that weekly applications for unemployment aid declined 13,000 to a seasonally adjusted 199,000. The four-week average, a less volatile figure, dropped 5,500 to 215,000.

House Speaker Nancy Pelosi said on Wednesday that Democrats would block President Donald Trump from delivering his State of the Union address until the government reopened — an announcement that Trump complied with. Recent surveys have also indicated that voters want the shutdown to end, with new polls suggesting that many believe Trump should compromise to end the partial closure.