Treasury yields fell Friday after August’s nonfarm payrolls report showed an easing labor market, fueling concerns of an economic slowdown.
The yield on the 10-year Treasury was 1 basis point lower at 3.723%. The 2-year Treasury yield dropped 9 basis points to 3.665%.
Yields and prices move in opposite directions. One basis point is equivalent to 0.01%.
Nonfarm payrolls expanded by 142,000 in August, the Labor Department reported Friday. Economists surveyed by Dow Jones expected an increase of 161,000 on the month, and forecast the unemployment rate eased slightly to 4.2%. The unemployment rate ticked down 4.2%, meeting the Dow Jones estimate.
That comes after data released Thursday showed that private payrolls grew by 99,000 in August, far lower than the 140,000 estimate. The figures renewed concerns about an economic downturn and a softening labor market, which were first prompted by July’s weaker-than-expected jobs report.
Weekly initial jobless claims meanwhile fell from the previous week, figures that were also released Thursday showed.
The data comes ahead of the next Federal Reserve meeting, which is set to conclude with an interest rate decision on Sept. 18. Markets are expecting the Fed to cut rates then, and were last pricing in a 57% chance of a 25-basis-point rate cut and a 43% probability of a 50-basis-point cut, according to CME Group’s FedWatch Tool.
Investors will be looking closely at economic data releases until then for clues about the path ahead for Fed policy and interest rates.