Treasuries fell as the US payrolls report showed employers added jobs and the unemployment rate unexpectedly fell to 8.6, stoking speculation the economy is accelerating.
US debt extended the first weekly loss in three weeks as employers added 120,000 jobs in November after an increase of 100,000 positions in the previous month, the Labour Department reported Thursday in Washington. The median forecast of 84 economists in a Bloomberg News survey was for the jobless rate to remain at 9 per cent. A European proposal to channel central bank loans through the International Monetary Fund may deliver as much as €200 billion (Dh990.92 billion) to fight the debt crisis, two people familiar with the negotiations said.
"The labour market continues to heal, albeit slowly," said Gary Pollack, head of fixed-income trading at Deutsche Bank AG's Private Wealth Management unit in New York, which manages $12 billion (Dh44.04 billion) in bonds. "The unemployment rate drop was pretty surprising."
The benchmark 10-year note yield rose three basis points, or 0.03 percentage point, to 2.12 per cent in early New York trading, according to Bloomberg Bond Trader prices. The yield on the 30-year bond was little changed at 3.09 per cent.
Treasuries have returned 8.5 per cent in 2011, set for the best annual return since a 14 per cent gain in 2008, Bank of America Merrill Lynch index data show. Investors bought the US securities as a haven as Europe's debt crisis threatened to infect the region's larger economies.
The US 10-year yield traded in a 28-basis-point range during November, with a high of 2.15 per cent and a low of 1.87 per cent. That compares with a 70-basis-point range the month before, with a high of 2.42 per cent and a low of 1.72 per cent.