Treasury Yields Rise Slightly to Start the First Full Trading Week of October


U.S. Treasury yields kicked off the first full trading week in October slightly higher.

The yield on the benchmark 10-year Treasury note added about 2 basis points, rising to 1.488% shortly after 4:00 p.m. ET. The yield on the 30-year Treasury bond rose less than a basis point to 2.048%. Yields move inversely to prices and 1 basis point is equal to 0.01%.

The 10-year U.S. Treasury yield hit 1.56% last week, its highest point since June, with investors concerned about inflationary pressures and tighter monetary policy. However, the benchmark yield pulled back on Friday.

"Bond yields appear to be preparing for an eventual pull back by the Fed while equities could rebound briefly on upcoming strong earnings reports," Sit Investment Associates Senior Portfolio Manager Bryce Doty told clients. With third quarter behind us, investors look to October earnings season. 

"October can often be a volatile month for financial markets as companies acknowledge they can't all make their original forecasts for the year," added Doty.

The main focus for investors this week will be ADP's September employment change report on Wednesday and the nonfarm payroll report for last month, due out on Friday.

In terms of the nonfarm payroll report, economists have forecast that around 475,000 jobs were created last month, according to an early consensus figure from FactSet. Just 235,000 payrolls were added in August, about 500,000 less than expected.

Auctions will be held on Monday for $42 billion of 13-week bills and $42 billion of 26-week bills.

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