NEW YORK: US Treasuries yields dropped on Friday after employers added 209,000 jobs in July, fewer than expected, and wage growth was stagnant in the month.
Yield have risen since strong gross domestic product for the second quarter on Wednesday increased expectations that the economy is gaining momentum.
The selloff accelerated on Thursday on inflation fears after data showed US labor costs recorded their largest increase in more than 5-1/2 years in the second quarter, a sign that a long-awaited acceleration in wage growth was imminent.
Data on Friday, however, showed that average hourly earnings - closely monitored as a potential signal of reduced slack that could prompt the Fed to raise rates - rose only one cent.
"The market was running scared after yesterday's outperformance of the employment cost index," said Gennadiy Goldberg, an interest rate strategist at TD Securities in New York. "Overall, it's a pretty positive report. The only really disappointing part of it is wages, and that should help calm the market."
Benchmark 10-year notes were last up 2/32 in price to yield 2.55 percent, down from 2.58 percent before the jobs data was released.
Comments
Comments are closed for this article.