Anika Begay
U.S. Treasuries fell on Monday as recession fears grew after a series of key economic data were released last week.
At 2:41 ET, the yield of the 10-Year Treasury Notes fell more than eight basis points to 3.7099%. 2-Year Treasury Notes The yield was last at 3.7315% after falling about 14 basis points.
Yields and prices move in opposite directions. One basis point equals 0.01%.
On Friday, the July nonfarm payrolls report showed that job growth for the month came in at just 114,000, below the Dow Jones estimate of 185,000 and the revised June figure of 179,000. The payrolls report also showed that the employment rate unexpectedly rose to 4.3%, the highest level since October 2021.
The data suggested a loosening of the labor market, which has raised concerns about a recession. That came after the Fed earlier in the week left interest rates unchanged and hinted at a rate cut in September. But many investors have since questioned whether the central bank would have to move to cut rates in the first place to avert an economic crisis.
According to CME Group’s FedWatch tool, markets are now pricing in an increasingly high probability of a 50 basis point rate cut when the Fed meets in September.
In the week ahead, investors will be watching comments from Fed officials, scanning them for clues about the outlook for economic and monetary policy. The ISM Services PMI, which tracks the performance of utilities companies, is also due on Monday and is expected to rise from a reading of 48.8 in June to 50.9 in July.
