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U.S. Treasury Yields Rise as Wage Growth Backs Bets on March Fed Hike

  • Inflation fears drive a bearish steepening in the yield curve
  • Odds of a March rate hike approached 90% after jobs data
Updated on

The U.S. 10-year note’s yield extended its climb, reaching the highest level in nearly two years, after December employment data showing strong wage growth fanned inflationary concerns and solidified March as the likely starting point for the first rate hike by the Federal Reserve.

While the 199,000 new jobs fell short of the expected 450,000 jump, wages for the past 12 months expanded at 4.7%, eclipsing an expected pace of 4.2%. The unemployment rate declined to 3.9%, below the forecast of 4.1%.