Quick Read – A 172,000 payroll beat drove the 10-year Treasury yield from 4.47% to 4.53%, pressuring TLT as SPY enters already up ten consecutive weeks. – Santelli flagged labor force participation at 61.8%, its lowest since September 2021, as a structural concern that could…
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The May employment data landed with a thud for bond bulls, with implications for Treasury proxies like the iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT). May nonfarm payrolls rose 172,000, the best number since March, when the figure came in at 185,000, and well above expectations. CNBC’s Rick Santelli, reacting on Squawk Box, asked, “Is there any doubt that this anecdotal evidence about a good labor market has been very correct?
That is a really strong number.” The market’s response illustrates a classic dynamic for fixed-income investors. Strong jobs data lifts Treasury yields and pressures bond prices, while also trimming hopes that the Federal Reserve may cut rates again soon. Holders of long-duration funds like the TLT ETF feel that pressure most acutely.