The 10-year U.S. Treasury yield jumped Friday after the February jobs report topped expectations, sending the benchmark yield to its highest level this year.
The yield on the 10-year Treasury note was trading at 1.617% at 8:40 a.m. ET, and has an intraday high of 1.626%. The yield on the 30-year Treasury bond rose to 2.34%. Yields move inversely to prices.
The U.S. added 379,000 jobs in February, according to the U.S. Bureau of Labor Statistics. Economists had projected a gain of 210,000. The unemployment rate fell slightly to 6.2%. The surge comes after the labor market’s recovery had turned sluggish in recent months.
The benchmark yield has been climbing quickly in recent months after ending 2020 under the 1% level. It topped 1.5% last week for the first time in over a year, and also briefly flashed above 1.6%. Thursday’s jump for Treasury yields put the 10-year above that mark.
The rise for bond yields comes as economists and Wall Street strategists have grown increasingly bullish on the U.S. economy as Covid-19 vaccines roll out. The prospect for strong economic growth, as well as budding concerns about inflation, have pushed down the prices for bonds.
The climb in the Treasury market has led some to speculate that the Federal Reserve may adjust its policy to hold down parts of the yield curve or even ease up on its dovish stance, but so far the central bank has not publicly shown interest in altering its course.
The 10-year yield rose to 1.55% on Thursday following comments from Federal Reserve Chairman Jerome Powell about inflation. Powell said he expected inflation to rise as the economy recovers, but he thinks it will be temporary.
“We expect that as the economy reopens and hopefully picks up, we will see inflation move up through base effects,” Powell said during a Wall Street Journal conference. “That could create some upward pressure on prices.”
There are no auctions due to be held on Friday.
— CNBC’s Patti Domm and Jeff Cox contributed to this report.
