FX.co ★ Treasury Yields Rise Sharply After Jobs Report

The yield on the US 10-year Treasury note climbed nearly 6 basis points to 4.34% on Thursday. This increase followed a jobs report that exceeded expectations, prompting investors to reduce their anticipations for Federal Reserve rate cuts in the current year. Nonfarm payrolls rose by 147,000 in June, surpassing forecasts, while the employment figures for May and April were also revised upward. Concurrently, the unemployment rate unexpectedly declined to 4.1%, and wage growth decelerated more than anticipated to 0.2%. As a result, traders have eliminated the possibility of a Federal Reserve rate cut in July, and the likelihood of a reduction in September has decreased to about 80%, compared to a full anticipation of a quarter-point cut prior to the release of the jobs report. Notably, Federal Reserve Chair Jerome Powell has been advocating for a "wait-and-see" and cautious approach. Additionally, market participants were closely monitoring legislative developments, as the House representatives moved forward with the significant bill, pending Congressional approval.