U.S. Treasury yields were higher on Friday following the release of key January jobs data.
The 10-year Treasury yield rose five basis points to 4.493%. The 2-year Treasury yield was last at 4.26% after also rising by five basis points. Yields and prices move in opposite directions. One basis point is equivalent to 0.01%.
The January nonfarm payrolls report showed net growth of 143,000 jobs, lower than the 169,000 expected by economists, according to Dow Jones. However, the unemployment rate dipped to 4.0% from 4.1% as job growth in the previous two months was revised higher.
Average hourly earnings were also stronger than expected, rising 0.5% in January and now up 4.1% over the past year. Economists were expecting increases of 0.3% and 3.7%, according to Dow Jones.
While the data could signal that jobs creation is slowing, the lower unemployment rate and strong wage growth supports the view that the labor market appears to be holding up well and job losses will not become an issue for the Federal Reserve any time soon.
A stable employment picture will be welcomed by markets in light of the Fed likely keeping interest rates on hold for several more months as policymakers wait to see how U.S. President Donald Trump’s fiscal, economic and trade policies, including potential tariffs, shake out.
The report comes after payrolls processing firm ADP on Wednesday said that private companies created 183,000 jobs in January. This was higher than December’s revised figure of 176,000 and also exceeded expectations.
The latest consumer sentiment report will also be published on Friday. Attention will then shift from this week’s jobs numbers to another key data point slated for next week — the January consumer and wholesale inflation figures.
