Treasury prices dipped Thursday after a government report showed fewer people applied for unemployment benefits last week.
Traders also positioned themselves ahead of a key employment report Friday and settled trades as the month and first quarter wound down.
"The jobs report kept trading subdued," said Kim Rupert, managing director of global fixed income analysis at Action Economics.
The price of the 10-year Treasury note fell 19 cents per $100 invested in late trading Thursday. Its yield, which moves in the opposite direction, edged up to 3.46 percent from 3.45 percent late Wednesday.
The Labor Department said Thursday that claims for unemployment benefits fell by 6,000 to 388,000, the second drop in three weeks. That was the latest sign that the labor market is improving.
Investors are anticipating the March employment report Friday from the Labor Department. Economists forecast that employers added 185,000 jobs in March. The unemployment rate is expected to remain unchanged at 8.9 percent.
Traders sold Treasurys before previous employment reports, anticipating that the jobs figure would come in higher than expected. But each time the numbers came in within expectations.
"No one wanted to make big bets on this report," Rupert said. "They had been burned before."
If the jobs outlook continues to strengthen, the Federal Reserve may alter its bond-buying program designed to stimulate the economy. Recent comments from Fed officials suggest that they could pull back if there is enough evidence that the economy is gaining steam.
In other trading, the price of the 30-year bond slipped 6 cents per $100 invested, while its yield was steady at 4.51 percent late Wednesday. The yield on the two-year note edged up to 0.83 percent from 0.80 percent.
The yield on the three-month T-bill edged down to 0.08 percent from 0.09 percent. The discount was 0.09 percent.