NEW YORK. — US Treasury yields plummeted after data showed on Friday the world’s largest economy created fewer jobs than expected in July, increasing the odds the Federal Reserve will resume cutting interest rates at its September meeting.
US two-year yields, which are tied to the Fed’s monetary policy, dropped 24.1 basis points (bps) to 3.710 percent, on track for their largest daily fall in two years. The yield also dropped to its lowest since June 30.
The benchmark 10-year yield also fell to a five-week trough and was last down 13.4 bps at 4.223 percent. It was on pace for its biggest one-day decline since early April.
Data showed US job growth slowed more than expected last month, while June’s data was revised sharply lower, pointing to a sharp moderation in the labor market.
Nonfarm payrolls increased by 73,000 jobs last month after rising by a downwardly revised 14,000 in June, data showed. Economists polled by Reuters had forecast payrolls increasing by 110,000 jobs after rising by a previously reported 147,000 in June. May’s data was also revised downward.
