Ten-year treasuries fell for the third day in a row on Wednesday after a report about U.S. services industries noted that they contracted less than expected, indicating a stronger than expected economy.
The manufacturing index from the Institute for Supply Management fell less than expected on Wednesday. The latest reading for February showed that activity fell, with a reading of 49.3 compared to 444.6 in January. Economists had expected a median estimate of 47.3, according to a poll by Bloomberg.
Ten year notes fell 9/32 to yield 3.674 at 1:35 p.m. in New York. The two-year treasury note rose 2/32 to yield 1.634.
Traders on the Chicago Board of Trade lowered their bets that the Federal Reserve Bank will lower interest rates by three-quarters of a percentage point during their March monthly meeting . There is a 48 percent chance the Fed will drop the current interest rate from 3 to 2.25 percent, according to the Wall Street Journal.