US bond yields continue to rise ahead of employment report
Treasury yields rose Friday ahead of the December payrolls report, following the biggest one-day rise in yields on benchmark Treasury bonds in a month.
what’s the matter
The yield on the two-year Treasury note BX:TMUBMUSD02Y rose 4.2 basis points to 4.42%.
The yield on the 10-year Treasury note BX:TMUBMUSD10Y rose 3.7 basis points to 4.04%. The 10-year yield rose 8.5 basis points on Thursday, the biggest gain since Dec. 8, according to Dow Jones Market Data.
The yield on the 30-year Treasury note BX:TMUBMUSD30Y rose 2.9 basis points to 4.18%.
What is driving the market
The Labor Department estimates that 170,000 non-farm jobs were created last month and the unemployment rate is expected to rise by a tenth to 3.8%. Hourly wages are expected to rise by 0.3%.
Goldman Sachs economists slightly beat market expectations for 190,000 jobs to be created. They note that seasonal adjustment factors could provide tailwinds and milder-than-normal winter weather for the Northeast and Midwest. But they said sluggish holiday spending signaled a decline in retail wages, as did the 38,000 drop in November.
Bloomberg News reported on Thursday a large options bet that the 10-year yield could rise to 4.15%, resulting in a $10 million profit if the yield ends up at 4.2%.
