U.S. August non-farm payrolls increased by 162,000, significantly exceeding expectations. The probability of a September rate hike rose to approximately 60%, and U.S. Treasury yields generally moved higher.
Data released by the U.S. Department of Labor on Friday showed that non-farm payrolls increased by 162,000 in August, approximately three times economists' expectations, indicating resilience in the labor market. Following this, the federal funds futures market showed that the probability of the Federal Reserve raising interest rates at its September 16 meeting rose to about 60%. The market reaction was hawkish, with all three major U.S. stock indexes closing down on Friday, and U.S. Treasury yields generally rising. The yield on the 2-year U.S. Treasury note, which is sensitive to monetary policy, rose by 3.4 basis points to 4.3703%, hitting an intraday high of 4.416%, the highest since January 2025. The market is now closely watching next week's CPI data to further assess the Federal Reserve's policy direction.
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