U.S. Treasury yields fell on Thursday while stocks moved down amid mixed economic signals, as investors watched budget talks in Washington and rebalanced portfolios with the end of September. The benchmark 10-year yield was down 1.7 basis points at 1.5219%. It reached as high as 1.557% on Thursday morning, then declined as investors sold off stocks and looked for safe havens. "It"s a risk-off movement that"s putting a little bit of a bid into Treasuries," said Andy Richman, managing director of Sterling Capital Management. Richman said the move was still slight and left the note"s yield above the 1.5% mark it crossed on Monday, several days after the U.S. Federal Reserve signaled it was shifting toward a more hawkish policy. The trading came as a pair of economic reports offered different signals. The number of Americans filing new claims for unemployment benefits increased last week for the third straight week, the U.S. Labor Department said, which could raise concerns that the jobs market was softening. Separately, the Commerce Department on Thursday confirmed that economic growth accelerated in the second quarter, thanks to pandemic relief money from the government, which boosted consumer spending. The reports provided enough support for bond buyers as they eyed ongoing budget talks in Washington, where the U.S. Congress faced a deadline to avoid a government shutdown and Democrats battled internally over spending plans. Failure to resolve the matters could disrupt financial markets, but major investors seemed to expect that leaders would at least reach temporary agreements. "We don’t believe, despite the degree of opposing views, that policymakers will allow a debt default to occur. The stakes are too high," Vanguard Group Inc Chief Investment Officer Greg Davis wrote in a company blog posted late on Wednesday. Meanwhile traders extending their positions at month-end should help keep bond prices firm, said Tom di Galoma, managing director of Seaport Global Holdings, in a note to investors. The Fed said on Thursday it accepted $1.6 trillion in reverse repurchase bids, a record high amount that also reflected month-end and quarter-end portfolio shifts. The yield on 10-year Treasury Inflation Protected Securities was at -0.857% and the breakeven inflation rate was at 2.386%. The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was down about a basis point at 0.2892%. A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an indicator of economic expectations, was roughly unchanged at 123 basis points. September 30 Thursday 2:08 PM New York / 1808 GMT Price Current Net Yield % Change (bps) Three-month bills 0.0375 0.038 -0.003 Six-month bills 0.05 0.0507 -0.002 Two-year note 99-236/256 0.2892 -0.008 Three-year note 99-144/256 0.5244 -0.014 Five-year note 99-114/256 0.989 -0.023 Seven-year note 99-138/256 1.3192 -0.022 10-year note 97-132/256 1.5219 -0.017 20-year bond 95-112/256 2.0301 -0.006 30-year bond 98-20/256 2.0867 0.000 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 10.00 1.50 spread U.S. 3-year dollar swap 13.75 1.25 spread U.S. 5-year dollar swap 8.50 1.25 spread U.S. 10-year dollar swap 2.00 0.50 spread U.S. 30-year dollar swap -25.75 -0.75 spread (Reporting by Ross Kerber in Boston)