Treasuries dropped, pushing 10-year note yields up for the third week this month, on speculation minutes of the Federal Reserve’s policy meeting indicated the bank may trim debt purchases by the end of the year.
Employers in the U.S. probably added fewer workers in October and the jobless rate rose for the first time in five months as the effects of the partial federal government shutdown rippled through the labor market, economists said before a report today.
The cost of betting on swings in an exchange-traded fund tracking Treasuries fell to the lowest level since 2010 on speculation volatility will diminish as the Federal Reserve delays plans to taper stimulus.
Halting the U.S. Treasury Department’s so-called extraordinary measures to stay under the nation’s debt limit will give investors more clarity and Congress more control in fiscal fights, economists said.
Ward McCarthy, chief financial economist at Jefferies & Co. Inc. in New York, said he expects U.S. growth to pick up during the second half of the year as inflation without food and fuel costs reaches 2 percent in 2012.
John Canally, an economist at LPL Financial Corp., and Ward McCarthy, chief financial economist at Jefferies & Co., said investors are looking to the Federal Open Market Committee’s January meeting for policy makers to further develop their communications plans. They spoke after the Fed’s decision today to keep policy unchanged.