Why the upcoming jobs report could send 10-year and 30-year Treasury yields surging
Another hot jobs report could also pressure the Federal Reserve to raise interest rates again in October.
On Friday, US Treasury yields turned mixed, with long-term yields rising while shorter-term yields fell. The 10-year Treasury yield remained steady at 5.20%, holding near a 19-year high of 5.228%. However, the 30-year bond yield reached a 22-year high, indicating stronger demand for longer-dated bonds. Fed officials' hawkish statements and the recent 25-basis-point rate hike contributed to the yield increase.
Fed Governor Michael Barr suggested further rate hikes, bolstering the case for a 25-basis-point hike near the end of the year. Global yields are supported by high oil prices due to the ongoing US-Iran conflict, which keeps inflation elevated. US Consumer Sentiment fell, with inflation expectations rising from 4% to 4.6% and a five-year period from 3.3% to 3.4%.
Meanwhile, core capital goods increased in August, propelled by the AI investment boom. The 30-year bond yield hovered at 5.488%, after peaking at 5.5016%. Interest rates impact borrowing costs, savers' returns, and currency values. Higher rates typically strengthen a country's currency and can weaken gold prices, as gold becomes less attractive compared to interest-bearing assets.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
