Treasuries Move Sharply Higher As Job Openings Drop To Ten-Month Low

(RTTNews) - Treasuries moved sharply higher during trading on Wednesday, regaining ground following the notable weakness seen in the previous session.

Bond prices showed a strong move to the upside in morning trading and remained firmly positive throughout the afternoon.

Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, tumbled by 6.6 basis points to 4.211 percent.

The strength among treasuries came as the Labor Department released a report showing job openings fell to a ten-month low in July, increasing confidence the Federal Reserve will lower interest rates later this month.

The Labor Department said job openings dipped to 7.181 million in July after tumbling to a downwardly revised 7.357 million in June.

Economists had expected job openings to fall to 7.375 million from the 7.437 million originally reported for the previous month.

With the decrease, job openings dropped to their lowest level since hitting 7.103 million in September 2024.

Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics, noted the decline in job openings pushed the job openings-to-unemployed ratio below 1.0 for the first time since April 2021, signaling a loosening demand for workers.

"The August employment report will be more pivotal than the JOLTS data in determining whether the Fed cuts rates at its upcoming meeting, but the picture of the labor market painted by the JOLTS data along with our forecast for August employment points to a rate cut at the next meeting," Vanden Houten said.

CME Group's FedWatch Tool is currently indicating a 95.4 percent chance the Fed will lower rates by a quarter point at its September meeting, up from 88.7 percent a week ago.

Trading on Thursday may be impacted by reaction to a slew of U.S. economic data, including reports on weekly jobless claims, service sector activity and the U.S. trade deficit.