U.S. Treasury bonds closed nearly flat on Friday, with yields deviating by less than 1 basis point from the previous close, gradually erasing most of the gains triggered by weaker-than-expected September CPI data. The U.S. Treasury auction cycle for next week begins on Monday with the issuance of 2-year and 5-year bonds, putting pressure on the market. Due to the U.S. government shutdown, most economic data, including employment figures, were not released, leaving traders’ bets unchanged on a 25-basis-point rate cut by the Federal Reserve at both its Wednesday meeting and in December. Interest rate volatility indicators remained near multi-month lows touched on October 3.
Shortly after 3 p.m. New York time, Treasury yields showed mixed movements, all within narrow ranges, with the 10-year yield hovering near 4% after earlier falling to 3.96% following the release of the CPI report; spreads steepened slightly but remained far below…
