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US Treasurys higher after strong jobs, dovish ECB

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U.S. sovereign bonds traded higher on Monday, following last week's strong jobs report, which supports an interest rate hike this month, and dovish comments from the European Central Bank.

The gains also came amid a drop in U.S. stocks and a more than 5 percent slide in the price of U.S. crude oil.

Yields on 10-year Treasurys were lower at 2.2244 percent on Monday, after closing at 2.275 percent on Friday, after the release of a better-than-expected jobs report.

Meanwhile, 30-year bond yields fell to trade at 2.9486 percent after ending at 3.009 percent in the previous session.

Ahead of next week's key Fed policy announcement – which seems bound to bring the first hike in the fed funds rate since 2006 – it also looks set to be a less eventful week, kicking off with just consumer credit figures for October at 3 p.m. ET on Monday.

Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
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US 2-YR
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US 5-YR
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US 10-YR
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US 30-YR
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Arguably the week's U.S. data highlights come on Friday with November retail sales figures, which are expected to report a further modest increase, as well as the preliminary reading of the University of Michigan's consumer sentiment survey for December.

It will also be a busy week on the supply side, starting with $54 billion worth of 13 and 26-week bills being auctioned on Monday, with 10-year and 30-year auctions expected later in the week.

St. Louis Fed President James Bullard spoke Monday, saying that inaccurate Fed U.S. economic forecasts have pulled the central bank in conflicting directions. The Fed goes quiet in the week before its rates meeting.

Markets are prepping for a rate hike December 16, after Friday's 211,000 November nonfarm payrolls showed a continuing solid trend of job creation.

European Central Bank President Mario Draghi said Friday that quantitative easing was unlimited, helping U.S. stocks close around 2 percent higher. "There is no particular limit to how we can deploy any of our tools," he said.

His comments, made in New York came after markets were disappointed Thursday, when the ECB it pledged to extend its bond-buying program, but fell short of expectations of greater stimulus.