Treasury Yields Hit Three-Month High on Strong Jobs Data


U.S. Treasuries yields jumped to their highest since September after data showed that U.S. employers added 203,000 jobs in November, raising expectations that the Federal Reserve will begin paring its bond-purchase program in the coming months.

Employers hired more workers than expected, and the jobless rate fell to a five-year low of 7.0 percent, the lowest since November 2008.

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The strength of the data increased bets that the Fed may begin paring its $85 billion-a-month program at its January meeting, and some traders say the U.S. central bank could act as soon as this month.

"It pulls forward some expectations, potentially for a December taper," said Ira Jersey, an interest rate strategist at Credit Suisse in New York, though he added that Credit Suisse sees a move in January as more likely.

The Fed will meet on Dec. 17 and 18 in its final meeting of the year. Some traders say it may be more hesitant to act in December for fear of disrupting market liquidity heading into year-end.

Benchmark 10-year notes were last down 4/32 in price to yield 2.90 percent, after rising as high as 2.93 percent, the highest since Sept. 13.

The Fed will buy between $4.25 billion and $5.25 billion in notes due 2017 and 2018 on Friday as part of its ongoing purchase program.