Treasuries Drop as Unemployment Rate Unexpectedly Falls

Treasury bond yields climbed to the highest level in two weeks after a report showing the U.S. unemployment rate unexpectedly fell added to concern the Federal Reserve’s pledge to sustain stimulus will spur inflation.

The difference in yields between 30-year bonds and inflation-protected securities increased to the most in almost three weeks after the Labor Department said unemployment fell to 7.8 percent in September, the lowest since President Barack Obama took office in January 2009. Fed policy makers said last month when they announced a third round of bond buying that they would continue to maintain stimulus measures even as the economy strengthened.