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TREASURIES-US yields jump as employers add more jobs than expected in May

BY Reuters | ECONOMIC | 06/07/24 08:56 AM EDT

June 7 (Reuters) - U.S. Treasury yields jumped on Friday after data showed that U.S. job growth accelerated far more than expected in May, keeping the Federal Reserve on track to hold off starting to cut interest rates until September at the earliest.

Nonfarm payrolls increased by 272,000 jobs last month, above economists expectations for 185,000 jobs gains.

The Labor Department's closely watched employment report on Friday also showed the unemployment rate ticked up to 4.0% from 3.9% in April.

Benchmark 10-year note yields were last up 13 basis points on the day at 4.414%. They got as low as 4.275% on Wednesday, the lowest since April 1.

Two-year note yields gained 14 basis points to 4.860% after dropping to 4.716% on Thursday, the lowest since May 16. (Reporting By Karen Brettell; Editing by Chizu Nomiyama)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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