US Treasury yields rise on strong services sector data

On Friday, US Treasury yields climbed following strong data on the expansion of the services sector in August. The 2-year yield rose to 4.223%, the 10-year yield increased to 4.724%, and the 30-year yield climbed to 5.266%. While this level was still below the recent highs, it was above the levels following Treasury Secretary Scott Bessent's buyback announcement on Wednesday.

According to S&P Global, the services Purchasing Managers' Index reached 56.8, its highest since December 2024. The Composite Output Index also rose to 56.0, the highest since April 2022. The services sector experienced its strongest growth in nearly two years, surpassing the slowdown in manufacturing due to supply disruptions from the US-Israeli conflict with Iran.

The PMI surveys suggest that US economic growth is on track to double the 1.5% annualized expansion rate seen in the second quarter, with nearly two-thirds of the third quarter already completed. Earlier on Friday, the S&P Global Eurozone Manufacturing PMI rose to a 54-month high, with manufacturing employment increasing for the first time in three years.