Nonfarm data falls short, dampening rate hike expectations, US Treasury yields decline in response

Odaily Odaily reports that the weaker-than-expected nonfarm payrolls report has led traders to lower their expectations for a Federal Reserve rate hike in the coming months, resulting in a rise in US Treasuries. The yield on the two-year note, most sensitive to monetary policy changes, fell 6 basis points to 4.11%, while the 10-year yield dropped 2 basis points to 4.46%.

Fed interest rate swaps indicate that traders now see about 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 quarter-point rate hikes by March 2027. (Jin Shi)