(Bloomberg) — Traders slashed their bets on the pace of future Federal Reserve interest-rate cuts after September US employment data blew past estimates and signaled a robust hiring trend.
Most Read from Bloomberg
The chance of a half-point rate cut in November was priced out, with the contract showing 25 basis points of easing now expected. Swap contracts tied to the outcome of future Fed meetings were pricing in only about 56 basis points of rate cuts for November and December combined, a drop of 10 basis points after the data.
Policy-sensitive two-year Treasury yields initially rose as much as 17 basis points to 3.87%, with the 10-year note backing up 12 basis points to 3.96%.
Figures released Friday showed employers created 254,000 jobs than the expected call of 150,000 in September.
“Overall, it’s a very strong report,” said Gregory Faranello, head of US rates trading and strategy for AmeriVet Securities. “The US rate market has been leaning and consolidating higher in yield off the back of better data this week and the jobs report adds icing on the cake.”
Faranello expects the Fed will continue “to lower rates but the debate around that pathway will be heightened after today’s release.”
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.
From: Yahoo.com
Financial News
