BOND REPORT: Treasurys Lower After Retail Sales, Price Data

By Deborah Levine

Treasurys declined Wednesday after a pair of government reports showed retail sales fell while import prices rose in July.

Two-year note yields (UST2YR) rose 5 basis points, or 0.05%, to 2.48%.

The Commerce Department said purchases at U.S. retailers declined 0.1% last month. Economists surveyed by MarketWatch expected sales to slip 0.3%.

Excluding automobiles, sales rose 0.4% last month, the smallest gain since February. The median forecast was for a 0.5% increase.

The report was "disheartening" in that is showed just how short-lived the tax rebates were, said Stone & McCarthy Research Associates.

The data "suggests the economy in the third quarter will get very little support from consumer spending," analysts wrote in a report. "Inflation remains very much a threat."

Separately, the Labor Department said import prices increased 1.7% in July, mostly on gains in petroleum and natural gas, compared with a 1% gain forecast by economists.