US Treasury prices hold higher after jobs report beat

Traders in the 10-year bond options pit at the Chicago Board of Trade signal orders.
Frank Polich | Reuters

U.S. government debt prices traded higher on Friday after the economy added more jobs than expected last month.

The U.S. economy added 178,000 jobs last month, the Labor Department said, with the unemployment rate falling to 4.6 percent. Economists polled by Reuters expected a gain of 175,000 with the unemployment rate holding steady at 4.9 percent. Wages, however, slumped to 2.5 percent.

"The report reaffirms the conditions of the employment market of the past several years," said Bill Lawrence, chief investment officer for traditional assets at SEI. "There are jobs out there, but the quality is not great." He also that, while the report will not change the Federal Reserve's mind about raising rates in two weeks, it might lead the central bank to normalize monetary policy at a slower pace.

On Thursday, traders used the Friday jobs report as part of an excuse to sell, driving interest rates sharply higher, with the 10-year yield spiking as much as 12 basis points — or 0.12 percentage points — at its peak, to 2.49 percent, the highest yield since June 2015.

The yield on the benchmark 10-year Treasury note, which moves inversely to its price, traded at around 2.39 percent, while the yield on the 30-year Treasury bond was also lower at 3.05 percent. The benchmark yield traded at 2.425 percent about 10 minutes before the jobs report's release.


In oil markets on Friday, U.S. crude settled up 1.21 percent at $51.68 a barrel. Wednesday saw OPEC agree to its first oil production cut in eight years, which has triggered a rally in oil prices.

—CNBC's Patti Domm contributed to this report