Treasury Yields Rise as Strong Jobs Data Fuels Fed Hike Expectations
Treasury yields rose on Friday as strong jobs data reinforced expectations of a Federal Reserve interest-rate hike later this month. The employment report showed August job growth exceeded forecasts, pushing up bets for a quarter-point increase at the Fed's mid-September meeting.
The two-year note yield climbed to 4.38% after the data was released, an 8 basis point jump before paring some of its gains. Swap contracts linked to the Fed's upcoming decision now price in a higher chance of a rate hike.
The five-year Treasury yield briefly touched its highest level since January 2025 as investors reassessed their expectations for monetary policy. With key inflation data due next week, the market is poised to remain vigilant ahead of the Fed's decision.