Nonfarm payrolls miss sparks rate hike expectations, U.S. Treasury yields fall

Odaily Planet Daily reported that a weaker-than-expected nonfarm payrolls report prompted traders to lower their expectations for a Federal Reserve rate hike in the coming months, leading to a rally in U.S. Treasuries. The two-year yield, which is most sensitive to changes in monetary policy, fell 6 basis points to 4.11%, while the 10-year yield fell 2 basis points to 4.46%.

Interest rate swaps for the Federal Reserve show that traders now see around a 20% probability of a rate hike at the Fed's meeting later this month, down from 33% before the data release. The market has priced in fewer than two 25-basis-point rate hikes through March 2027. (Jin Shi)