MW: Treasurys rise as payrolls come in worse than forecast
By Nick Godt, MarketWatch
NEW YORK (MarketWatch) -- Treasury prices rose Friday, sending yields lower, as bond traders reacted to Labor Department data that showed the U.S. economy losing 85,000 jobs in December, results that came up short of the slight growth that had been expected.
Yields on benchmark 10-year Treasury notes (UST10Y 3.79, -0.04, -0.92%) , which move inversely to prices, fell four basis points to 3.783%. Yields on two-year notes (UST2YR 0.95, -0.07, -6.66%) also fell, down 7 basis points to 0.952%.
Job losses resumed in December after revised figures showed nonfarm payrolls rose in November for the first time in nearly two years.
Specifically, payrolls fell by a seasonally adjusted 85,000 in December following a revised increase of 4,000 in November. During 2009, payrolls fell by 4.2 million. Read more on jobs.
The official U.S. unemployment rate remained at 10% in December.
Prices for government debt rallied as December payrolls "came in well below inflated expectations of a positive print, along with back revisions," analysts at Action Economics said in a note.
Economists surveyed by MarketWatch had looking for payrolls to rise by 10,000 and for the unemployment rate to rise to 10.1% from 10%.
On Thursday, Treasurys fell and yields advanced as traders took a cautious approach in anticipation of the jobs report and as the U.S. government announced it will raise $84 billion next week.
The Treasury Department said it will sell $74 billion in notes and bonds and an additional $10 billion in Treasury-inflation protected securities.
A total of $40 billion in 3-year notes, $21 billion in 10-year notes and $13 billion in 30-year bonds will be auctioned. Both the 30-year bonds and the 10-year notes are re-openings, the Treasury said.
