NEW YORK, Nov 2 (Reuters) - Prices for long-dated U.S. Treasuries dipped on Friday after better-than-expected jobs data suggested a labor market recovery that could eventually mean higher consumer prices, as traders turned their eyes to next week's presidential election. The Labor Department's report that job growth in October exceeded the most optimistic forecasts weighed on 30-year bonds. ``If the economy is improving, the bond market reads into that that we could have a little more inflation, and that adversely affects long-term bonds more than short-term Treasuries,'' said Jeffrey Cleveland, senior economist at Payden & Rygel, in Los Angeles. Thirty-year Treasury bonds were down 07/32, their yields up to 2.919 percent from 2.91 percent late on Thursday. The U.S. Labor Department said employers added 171,000 people to payrolls in October and that 84,000 more jobs were created in August and September than earlier estimated, but the workweek length and hourly wages remained flat. The data could help President Barack Obama in his bid for a second term. Traders are weighing the chances the Democrat can win re-election against Republican Mitt Romney, as well as what a victory for each would mean for U.S. government debt. ``We expect the knee-jerk reaction in financial markets to be positive (risk on) if Romney wins and muted if Obama is re-elected,'' said Signe Roed-Frederiksen of Danske Bank. ``Focus will quickly shift to the negotiations about the fiscal cliff as Congress convenes again in the lame duck session.'' However, analysts said the jobs data are unlikely to budge the Federal Reserve from its current easy stance on monetary policy. ``Incomes aren't really growing, and if incomes don't grow, how can spending grow?'' said Wilmer Stith, vice president and portfolio manager of the Wilmington Broad Market Bond Fund in Baltimore. ``By no means is the economy out of the woods.'' Jim Kochan, chief fixed-income strategist at Wells Fargo Funds Management LLC in Menomonee Falls, Wisconsin, observed that Treasuries have been ``range-bound'' for several weeks. ``The employment report was a good release, and more often than not, when the Treasury market sees stronger economic numbers, it sells off and then settles down again,'' he said. The jobless rate edged a tenth of a point higher to 7.9 percent, but that was due to workers returning to the workforce. Only people who are looking for a job count as unemployed.
The stronger-than-expected October jobs report, a shortened week after the massive storm Sandy hit New York and a push by issuers to get deals through before next week's presidential election boosted issuance in the U.S. investment-grade market, IFR reported. Eleven new deals were announced, including a three-part benchmark deal from Microsoft, a U.S. $2 billion deal from health insurer Aetna and a benchmark four-part deal from Verizon. ``With Hurricane Sandy, we ended up with the transactions scheduled over the course of this week jammed into the last two days, and with positive payroll numbers and elections on Tuesday, everyone felt like they should take the risk off the table and do their deal today,'' said the head of debt capital markets at a big U.S. bank.