10-Year Treasury Yield Is Above 1.5% After Stronger-Than-Expected ADP Jobs Report

Source: NYSE

The 10-year U.S. Treasury yield was flat around 1.5% on Wednesday after data showed companies hired at a faster than expected pace in September despite worries over the Covid delta variant.

The yield on the benchmark 10-year Treasury note fell 1 basis points to 1.522% at around 4:00 p.m. ET. The yield on the 30-year Treasury bond dropped 2 basis points to 2.076%. Yields move inversely to prices and 1 basis point is equal to 0.01%.

Private jobs rose by 568,000 for the month, according to a report Wednesday from payroll processing firm ADP. The reading came in better than the Dow Jones estimate from economists of 425,000 and ahead of the downwardly revised 340,000 reading in August. The initial August report showed growth of 374,000.

"The labor market recovery continues to make progress despite a marked slowdown from the 748,000-job pace in the second quarter," ADP Chief Economist Nela Richardson said.

The closely watched nonfarm payrolls report for September is then due out at 8:30 a.m. ET on Friday.

A recovery in the labor market is one indicator being used by the Federal Reserve to decide when it should tighten monetary policy. The central bank said in its September meeting that it would soon look to pull back its purchasing of bonds.

The 10-year rate topped 1.56% last week, which was its highest point since June, amid inflation and tighter monetary policy concerns.

A better-than-expected manufacturing reading Tuesday aided optimism about the economic recovery. The Institute for Supply Management's services purchasing managers' index report for September rose to 61.9 from 61.7 in August, 0.2 points better than expected.

Auctions are due to be held on Wednesday for $30 billion of 119-day bills and $40 billion of 64-day bills.

— CNBC's Hannah Miao contributed to this market report.

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