Another hot jobs report could also pressure the Federal Reserve to raise interest rates again in October The coming week will be big for the bond market from an economic-data standpoint, with the release of the August PCE report and the September jobs report. With yields on long-dated Treasury notes and bonds at levels not seen in two decades, the economic data could determine whether rates rise even further. The 10-year and 30-year Treasury yields are closing in on their next major technical resistance levels, which could see them break out and surge to 5.6% and 5.9%, respectively, over the near term.
And with expectations for the jobs report fairly low, it may not take much for them to reach those levels. Analysts are forecasting the August headline personal consumption expenditures price index to rise 0.4% month over month from 0.2% in July, while remaining unchanged at 3.7% year over year. Core PCE is expected to rise 0.3% month over month from 0.2%, remaining unchanged at 3.3% year over year.
The PCE reading is unlikely to cause much trouble for markets, as analysts seem to have a good handle on it, basing their estimates on the consumer- and producer-price index reports from earlier in September. Infrastructure investing: A hedge against inflation and geopolitics?Play video: Infrastructure investing: A hedge against inflation and geopolitics? The jobs report, however, may pose a bigger problem.
Analysts expect to see only 100,000 jobs created in September, down from 162,000 in August. Meanwhile, the unemployment rate is expected to remain unchanged at 4.1%. Don’t Short Yourself offers weekly money tips to help you earn it, stack it and grow it.
I would like to receive updates and special offers from Dow Jones and affiliates. I can unsubscribe at any time. The report that unsettled the market was the S&P Global U.S.
PMI report on Sept. 23, which noted that employment, by S&P Global’s measure, rose in September at its fastest pace since June 2022 and at a pace rarely exceeded since 2009. That commentary suggests the risk to September jobs could be higher than what analysts are estimating. Currently, the 10-year Treasury yield is floating at 5.2% and sitting just below an area of technical resistance at 5.25% that dates back to July 2007, which could be a delicate line in the sand.
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