Bond Report: Treasury yields mixed ahead of U.S. GDP data

They caution, however, that the headline figure might mask a still robust economy. GDP is expected to be weighed down by a record U.S. international trade deficit, less government spending, and a decline in inventory levels, though consumer spending and business investment — the most important components — likely remained strong, economists said.

Read more: GDP may have shrunk in the first quarter, but not because U.S. economy was bad

Treasury yields have pulled back somewhat from levels last seen in December 2018 for the 10- and 2-year notes. The year-to-date runup in yields has come as investors look for the Federal Reserve to move aggressively to raise interest rates and shrink its balance sheet to rein in inflation running at its hottest in more than four decades.

Investors are also paying attention to Russia’s invasion of Ukraine, with the war now in its third month. Energy-related tensions between Moscow and the West have escalated with Russia earlier this week shutting off natural-gas supplies to Poland and Bulgaria after they refused to make payments in rubles, as demanded by Russian President Vladimir Putin.

Other U.S. economic data due Thursday include weekly jobless claims, with applications for first-time benefits expected to fall to 180,000 in the week ended April 23 from 184,000 a week earlier.

What are analysts saying?

“Macroeconomic data releases will be in the spotlight today. In particular, if the U.S. GDP growth comes in above consensus — as we expect — UST yields will probably continue the upward move they started yesterday,” wrote economists at UniCredit, in a note.