Treasury Yields Rise as Employment Data Keep Fed Hikes in Play
- Traders push estimated peak policy rate in 2023 above 4.66%
- September inflation report next week may determine next move
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Treasury yields rose to new weekly highs after resilient US job creation and wage gains during September were seen as keeping the Federal Reserve on a tighter policy track.
The policy-sensitive two-year climbed nearly nine basis points to 4.34% -- within a basis point of a multiyear high -- and the swap contract for the November Fed meeting priced in 73 basis points of tightening. The five-year yield climbed as much as 10 basis points to 4.17%, anticipating the policy rate will remain elevated for an extended period. Treasury yields had eased back from their session highs by late in New York, and remained firmer on the week. The bond market is closed Monday for a US holiday.