U.S. Treasury yields steady as investors await key labor market data

On Tuesday, U.S. Treasury yields saw little change as investors closely evaluated the state of the economy, awaiting critical labor market data that could shape Federal Reserve monetary policy. At 04:14 ET, the yield on the 10-year Treasury had dipped slightly to 4.6766%, hovering around levels last witnessed over 15 years ago. The yield had risen to 4.701% on Monday, marking its highest level since October 15, 2007. The 2-year Treasury yield was also down by approximately one basis point at 5.1021%.

Investors are keeping an eye on comments from Fed speakers and economic data expected this week, including August’s Job Openings and Labor Turnover Survey due Tuesday, which economists surveyed by Dow Jones anticipate will reflect 8.8 million job openings. Other crucial data releases this week include September’s jobs report due on Friday.

Central bank officials have hinted at another rate increase and rates staying elevated for a longer period since their meeting in September. However, there is ongoing uncertainty about when the rate hike may be implemented. Two central bank policy meetings remain this year, scheduled for October 31-November 1 and December 12-13.

In other developments, U.S. lawmakers managed to avert a government shutdown by passing a last-minute spending bill on Saturday night. This move has provided them with additional time to finalize necessary government funding legislation. A potential shutdown could have adversely impacted the U.S. credit rating as well as the country’s economy.

It’s important to note that yields and prices move in opposite directions and one basis point equals 0.01%. As such, even slight changes in yields can have significant implications for bond pricing and, by extension, investor sentiment towards U.S. Treasuries.