NEW YORK: Treasuries yields increased on Friday after US employers added 248,000 jobs to their payrolls in September, more than economists had expected.
Employers stepped up hiring in September and the jobless rate fell to a six-year low, which could bolster bets on a Federal Reserve rate hike in mid-2015 or earlier.
The improvement was clouded by disappointing hourly earnings, however. Average hourly earnings increased a modest 2.0 percent in September from a year earlier. Before the 2007-09 recession, wages rose at a much faster rate.
"The headline was stronger than expected," said Justin Lederer, an interest rate strategist at Cantor Fitzgerald in New York. But "hourly earnings were weaker than expected ... its still not where the Fed wants it to be."
Benchmark 10-year notes were last down 13/32 in price to yield 2.48 percent, up from 2.44 percent before the data was released.
Falling inflation has compounded concerns that the Federal Reserve will be hesitant to raise interest rates even as unemployment falls.
US Treasury Inflation-Protected Securities (TIPS) suffered their largest quarterly loss in the third quarter on signs of a slowdown in price increases and oil prices slumping to their lowest in two years.
Gold fell below $1,200 an ounce for the first time this year on Friday.
Friday's data is a reminder that wages in particular remain stubbornly stagnant, even after five years of monetary stimulus.
"That will be critical to the Fed in reading the amount of slack in the economy," said Jake Lowery, a portfolio manager at Voya Investment Management in Atlanta.
The next focus for the market will be $61 billion in new supply next week.
The Treasury will sell $27 billion in three-year notes on Tuesday, $21 billion in 10-year notes on Wednesday and $13 billion in 30-year bonds on Thursday.
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