Treasury yields sat unchanged Friday morning as traders waited for the July nonfarm payrolls and jobless claims data due later in the day. Economists expect payrolls to show a gain of 83,000 jobs, with unemployment holding at 4.2%. Tressis chief economist Dan Lacalle argued against further Fed tightening as oil prices ticked higher into the release.
The yield on the 10-year Treasury note held steady at 4.6719% Friday morning, with traders reluctant to move ahead of the day's labor market report. The 2-year yield, which tracks short-term Federal Reserve rate expectations most closely, was unchanged at 4.2431%. The 30-year yield held flat at 5.2189%.
Investors are looking to the jobs report for a clearer read on the U.S. economy and its effect on the Fed's rate decisions. Economists expect July's nonfarm payrolls to show an increase of 83,000 jobs. The unemployment rate is forecast to hold at 4.2%.
Against that backdrop, Dan Lacalle, chief economist at Tressis, pushed back on the case for a rate hike. According to CNBC: "It makes no sense for the Fed to hike rates." He told CNBC's "Squawk Box Europe" Friday that the economy shows no sign of overheating, adding that core inflation gauges CPI and PCE point to rate increases having no impact on energy prices.
Energy markets moved the other way. West Texas Intermediate futures rose 0.67% to $77.81, while Brent crude gained almost 1% to $83.31.
Source: CNBC
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