TREASURIES-Prices fall as Oct. job gains top expectations

* October non-farm payrolls rise more than expected

* Previous month’s job losses revised down

* 30-year bond yield reaches highest since June

By Chris Reese

NEW YORK, Nov 5 (BestGrowthStock) – U.S. Treasury debt prices fell
on Friday, driving the 30-year bond yield to its highest level
since June, after a far greater-than-expected gain in
employment in October erased the safe-haven appeal of
government debt.

Non-farm payrolls rose 151,000 last month, more than twice
analysts’ expectations for growth of 60,000 jobs, and the
government revised payrolls for August and September to show
110,000 fewer jobs lost for the two months.

While the jobs data suggested some recovery in the labor
market and sapped Treasuries’ safe-haven appeal, losses were
limited as the unemployment rate held steady at 9.6 percent and
the Federal Reserve’s plan to buy a further $600 billion of
Treasuries loomed.

“The bond market is holding in quite well, considering that
the last four months now each show private payroll gains of
more than 100,000. The numbers for the last four months look
much much better. It looks like the economy picked up since
June,” said Cary Leahey, economist at Decision Economics in New
York.

Benchmark 10-year Treasury notes (US10YT=RR: ) were trading
13/32 lower in price to yield 2.54 percent, up from 2.49
percent late on Thursday, while the 30-year bond (US30YT=RR: )
was 1-8/32 lower to yield 4.14 percent from 4.06 percent. The
bond yield rose as high as 4.18 percent, the loftiest since
June 22.

“The pullback is limited versus what it would be doing
without the benefit of quantitative easing and this (payrolls)
number won’t change QE,” said David Ader, head of government
bond strategy at CRT Capital Group in Stamford, Connecticut.

The price move steepened the Treasury yield curve, with the
spread between two-year note yields and 10-year note yields
widening to 219 basis points from 216 basis points late on
Thursday.

The Fed on Wednesday said it will buy an additional $600
billion of Treasuries in coming months in an effort to reduce
interest rates like those on mortgages and stimulate the
economic recovery.
(Additional reporting by Ellen Freilich; Editing by Leslie
Adler)

TREASURIES-Prices fall as Oct. job gains top expectations