By Karen Brettell
NEW YORK, Aug 19 (Reuters) – U.S. Treasury yields fell on Thursday, with a diminished risk appetite on concerns about the spread of COVID variants, and a day after the Fed Federal suggested it could start reducing bond purchases this year.
* Wall Street opened lower on Thursday, helping to boost demand for US government bonds.
* “I think, for the most part, what we’re seeing now is a reaction to concerns about the Delta variant (and) the aftermath of that kind of shocking report on consumer confidence that we received last Friday,” Kevin said. Flanagan of WisdomTree.
* Data released Friday showed US consumer confidence fell to its lowest level in a decade in early August.
* Minutes from the Fed’s July meeting, released Wednesday, showed that most of the committee that sets monetary policy is converging around a plan that would lead to a cut in bond purchases by the end of 2021.
* The return of the 10-year bond was down 3 basis points at 1.247%. Earlier this month, the benchmark yield fell to 1.127%, the lowest since February.
* Investors’ attention is now on Fed Chairman Jerome Powell’s speech in Jackson Hole next week. Powell’s words are expected to signal when the stimulus reduction will be announced.
* Data released Thursday showed the number of people filing new claims for unemployment benefits fell to a 17-month low last week, pointing to another month of strong job growth, despite the rise in jobless cases. COVID-19 represents a risk for the recovery of the labor market.