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year Treasury yields fall from 15-year highs after jobs report

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NEW YORK — Yields of short-term U.S.

Treasuries fell from multi-year highs Friday after a closely

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watched employment report showed unemployment rising and job

growth slowing in August.

Non-farm payrolls increased by 315,000 jobs last month, down

from a surging 526,000 in July, the Labor Department said. The

unemployment rate increased to 3.7% from a pre-pandemic low of

3.5% in July.

Economists polled by Reuters had forecast payrolls

increasing 300,000. Estimates ranged from as low as 75,000 to as

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high as 450,000.

The jobs data comes a week after Federal Reserve Chair

Jerome Powell said that the U.S. economy may face a painful

period of slow economic growth and rising unemployment as the

central bank continues an aggressive pace of interest rate hikes

to curtail inflation, which is running near 40-year highs.

The two-year U.S. Treasury yield, which typically

moves in step with interest rate expectations, was down 4 basis

points at 3.482% after hitting 15-year highs the day before.

The yield on 10-year Treasury notes was up 1.7

basis points to 3.282%, one day after hitting two-month intraday

highs, while the yield on the 30-year Treasury bond

was up 3 basis points to 3.404%.

Bond yields rise as bond prices fall.

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“The basic message is the labor market might be starting to

cool and the Fed might not have to move so aggressively,” said

David Page, head of macroeconomic research at Axa Investment

Managers.

A closely watched part of the U.S. Treasury yield curve

measuring the gap between yields on two- and 10-year Treasury

notes, seen as an indicator of economic

expectations, was at -20.8 basis points.

September 2 Friday 8:47AM New York / 1247 GMT

Price Curr Net

ent Change

Yiel (bps)

d %

Three-month bills 2.8775 2.93 -0.016

77

Six-month bills 3.3125 3.41 0.041

41

Two-year note 99-140/256 3.48 -0.034

82

Three-year note 98-226/256 3.52 -0.021

78

Five-year note 98-196/256 3.39 -0.014

63

Seven-year note 98-116/256 3.37 0.002

54

10-year note 95-136/256 3.28 0.015

03

20-year bond 95-208/256 3.67 0.023

29

30-year bond 92-112/256 3.40 0.031

47

DOLLAR SWAP SPREADS

Last (bps) Net

Chan

ge

(bps

)

U.S. 2-year dollar swap 36.00

spread 0.75

U.S. 3-year dollar swap 13.75

spread 0.00

U.S. 5-year dollar swap 7.00

spread 0.25

U.S. 10-year dollar swap 8.75

spread 0.00

U.S. 30-year dollar swap -30.25 -1.

spread 00

(Reporting by David Randall; Editing by Andrea Ricci)



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