Bonds Slide Following Jobs Report

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Treasuries were mostly higher Friday afternoon, as bond traders continued to mull the state of the economy after the October jobs report came in weaker than economists expected.

The two-year was up 2/32 to 100 18/32, yielding 2.45%. The five-year was off 7/32 to 104 11/32 to yield 3.57%. The 10-year Treasury was down 24/32 to 105 10/32, yielding 4.33%, and the long bond was losing 1 30/32 to 107, yielding 4.92%. The 30-year had been much stronger in the past two sessions, dramatically lowering yields, after the Treasury Department disclosed plans to discontinue the issue.

The Labor Department said nonfarm payrolls fell by 415,000 in October, lifting the unemployment rate to 5.4%, its highest level in five years. The rate had stood at 4.9% at the end of September. The payroll decline was the biggest monthly loss of jobs since May 1980.

Both numbers were worse than expected and should give the Fed more reason to cut interest rates by another half-percentage point when its policymaking arm meets next week.