yields on us government bonds climbed friday aided by a strong jobs report after a burst of quarterend buying had driven them lower in recent sessions the yield on the benchmark 10year us treasury note settled at 2374 according to tradeweb compared with 2324 thursday shortterm treasury yields rose more than longerterm yields reflecting expectations that the fed could start raising its benchmark federalfunds rate in halfpercentagepoint increments in coming meetings in an effort to tame inflation the twoyear yield settled at 2430 compared with 2284 thursday it was the first time the twoyear yield closed above the 10year yield since 2019 a sign investors think the fed could start cutting rates in response to slowing economic growth not long after it has finished raising them yields which rise when bond prices fall climbed in the overnight session shorterterm yields especially then took another leg upward after data from the labor department showed that the economy added 431000 jobs in march and that average hourly earnings increased 04 from the previous month bond investors have been particularly focused on wage gains which can be a longterm driver of overall inflation the data for march showed that wages are still climbing at a rapid clip returning to trend after they were reported to be nearly flat in the previous data release “overall this is an extremely consensus payrolls report that will keep the fed on track” to raise rates by half a percentage point at its may meeting ian lyngen head of us rates strategy at bmo capital markets wrote in a note to clients friday’s trading suggested that a tough period for bond investors may not be over after they got a reprieve in recent sessions—with the 10year yield declining after reaching 25 in intraday trading on march 25 despite the lastminute rally bonds still suffered their worst quarter in four decades thanks to continued high inflation and escalating expectations for how much the fed could tighten monetary policy over the next two years the bloomberg us aggregate bond index—largely us treasurys highly rated corporate bonds and mortgagebacked securities—returned minus 59 over the first three months of the year its biggest quarterly loss since 1980