10-year Treasury yield surges above 0.9% after better-than-expected jobs report

Treasury yields surged on Friday after jobs data for May blew past expectations.

The yield on the benchmark 10-year Treasury note popped 11 basis points to 0.926%, the highest level since March 24. The benchmark rate has risen about 30 basis points this week alone, on pace for its best weekly performance since late February.

The yield on the 30-year Treasury bond also jumped about 10 basis points to 1.723%. Yields move inversely to prices.

Employment unexpectedly rose by 2.5 million in May and the jobless rate declined to 13.3% according to data Friday from the Labor Department. Economists surveyed by Dow Jones had been expecting payrolls to drop by 8.333 million and the unemployment rate to rise to 19.5% from April's 14.7%.

The better-than-feared reading provided another signs of economic recovery from the depths of the damage from the coronavirus pandemic.

"This much better than expected report reinforces our view that April likely marked the trough in US economic activity," Brian Coulton, chief economist at Fitch Ratings, said in a note. "The sharp pick-up in leisure and hospitality jobs and in construction and retail  employment speaks to the impact of the easing in lockdowns in May and to the huge share of unemployed in April who were reported to be on 'temporary' lay-off."

U.S. government bond yields had began to push higher Thursday after the European Central Bank announced higher-than-expected purchases of euro zone debt. The ECB said it will increase its Pandemic Emergency Purchase Program by 600 billion euro, bringing the program's total to more than 1 trillion euro.

"Helping to lift rates is the continued persistent rise in equity prices and all the stimulus coming, both monetary and fiscal," Peter Boockvar, chief investment officer at Bleakley Advisory Group.


—CNBC's Silvia Amaro contributed reporting.