U.S. Treasury yields hold steady ahead of September jobs data
U.S. Treasury yields were largely unchanged on Friday as investors awaited the September nonfarm payroll report, with markets pricing a high probability of unchanged Fed rates in October.
U.S. Treasury yields were mostly flat on Friday, following a week marked by a broad bond selloff and rising expectations of persistent inflation. The benchmark 10-year Treasury yielded 5.235%, after briefly reaching multi-year highs, while the 30-year Treasury held at 5.603%, its highest level in 24 years. The two-year note rose to 4.80%.
Across major European markets, 10-year government bond yields fell about three basis points, easing some of the pressure seen earlier in the week. Analysts attribute the recent yield increases to concerns over stubborn price growth and hawkish comments from central banks, which suggest interest rates may stay elevated.
Investors are focused on the upcoming September nonfarm payrolls report, scheduled for Friday morning. Consensus forecasts anticipate the addition of 84,000 jobs and an unchanged unemployment rate of 4.1%. Deutsche Bank analysts noted that the jobs data have been a key driver for U.S. risk assets and have given the Federal Reserve room to consider further rate hikes.
According to the CME Group's FedWatch Tool, market participants assign a 72% probability that the Federal Reserve will leave rates unchanged at its October meeting.