U.S. Treasury yields rose Friday after a strong jobs report that was in line with goals the Federal Reserve has set to start unwinding stimulus.
The yield on the benchmark 10-year note was up 7.3 basis points at 1.2902% in morning trading.
Much of the rise came after Labor Department statistics showed U.S. job growth rose solidly in July amid demand for workers in the labor-intensive services industry.
Nonfarm payrolls increased by 943,000 jobs last month after rising 938,000 in June, the department said in its closely watched employment report.
Yields had already risen this week after U.S. Federal Reserve Vice Chair Richard Clarida suggested on Wednesday that conditions for hiking interest rates might be met as soon as late 2022, earlier than market expectations.
The 10-year yield, the world’s most significant interest rate, touched as low at 1.127% on Wednesday, its lowest since February and continuing steady declines that drove the note down from its high this year of 1.776% in April.
The yield on 10-year Treasury Inflation Protected Securities was -1.065%, well above its record low of -1.216% earlier this week. The 10-year TIPS break-even inflation rate was at 2.35%, slightly above its level Thursday.
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 at 107 basis points, 5 basis points higher than Thursday’s close.
The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was up 1.6 basis points at 0.2182%.
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