Treasury yields rise as investors consider interest rate outlook
U.S. Treasury yields marched higher on Monday as investors assessed the outlook for interest rates after Friday’s jobs report and prepared for a week of light economic data.
The yield on the 10-year Treasury was up more than 9 basis points at 4.649%. The 2-year Treasury
was last trading up nearly 11 basis points at 4.941%.
Yields and prices move in opposite directions and one basis point is equivalent to 0.01%.
U.S. Treasury yields marched higher on Monday as investors assessed the outlook for interest rates after Friday’s jobs report and prepared for a week of light economic data.
The yield on the 10-year Treasury was up more than 9 basis points at 4.649%. The 2-year Treasury
was last trading up nearly 11 basis points at 4.941%.
Yields and prices move in opposite directions and one basis point is equivalent to 0.01%.
Treasurys
Treasury yields on Monday made up some ground after the yield on the 10-year and 2-year Treasury note fell by as much as 9 and 13 basis points, respectively, on Friday.
That came as October’s nonfarm payrolls figures came in lower than expected at 150,000. October’s reading also marked a significant decline from September’s 297,000 and showed a slight increase in the unemployment rate to 3.9%.
The data suggested to investors that the labor market could be easing, raising hopes that the Federal Reserve may be done hiking interest rates. Cooling the jobs market has been one of the central bank’s key aims throughout the rate-hiking cycle that began in March 2022, alongside easing the overall economy and bringing down inflation.
The Fed left interest rates unchanged for the second time in a row last week. The central bank kept rates at the same level since July, but left the door open to further rate increases.
“All eyes are on the 2-year and 10-year,” said Rich Steinberg, chief market strategist at The Colony Group, expecting equities to continue to show sensitivity to yields. “The debate is going to continue to be hard landing, soft landing, no landing, and I don’t think that one week is going to keep those concerns off of people.”
This week ushers in a period of light economic data, with no key figures expected Monday. Several Fed officials are expected to give remarks. That includes two speeches from Fed President Jerome Powell, which investors are hoping will provide fresh hints into monetary policy and the economic outlook.
