NEW YORK (CNN/Money) - Treasury prices stumbled lower Friday, pumping short-term yields to two-year highs as another solid month of job gains reinforced predictions for a Federal Reserve interest rate hike at the end of the month.

The benchmark 10-year note fell 14/32 of a point to 99-25/32 to yield 4.78 percent, up from 4.71 late Thursday.

The 30-year bond shed 20/32 of a point to 98-25/32 to yield 5.46 percent, up from 5.41 late yesterday. Bond prices and yields move in opposite directions.

The two-year note fell 4/32 to 99-20/32 to yield 2.69 percent. Its intraday high of 2.70 percent was the highest reading since July 2002 and far from the 1.43 percent trough touched earlier this year.

The five-year note dropped 9/32 to 99-21/32 to yield 3.95.

Wall Street economists who were already calling for a June rate rise stuck to their forecasts. Those who had thought the central bank could wait until August changed their minds after the jump in May payrolls, also converging on a June move.

Overall, the market's losses were modest, suggesting inflation had replaced jobs as the primary concern of bond investors.

"The bond market is really refocusing away from payrolls and toward CPI," said Anton Pil, global head of fixed income for the J.P. Morgan Private Bank, referring to the Labor Department's index of consumer prices.

YOUR E-MAIL ALERTS Follow the news that matters to you. Create your own alert to be notified on topics you're interested in. Or, visit Popular Alerts for suggestions. Manage alerts | What is this?

"That'll be a much more relevant number that will give us an indication of the speed at which the Fed may or may not have to raise rates."

A Reuters survey taken after the jobs data also found 20 economists expect a follow-up move on rates from the Fed at its August meeting.

U.S. non-farm payrolls rose 248,000 in May, above forecasts of a 216,000 gain, but short of some of the loftier predictions floating around in the market. Job gains in April and March were both revised higher, while the unemployment rate held at 5.6 percent.

"These are generally very good numbers and another sign that the Fed is going to be raising interest rates sooner rather than later," David Wyss, chief economist at Standard & Poor's, told Reuters.

In the currency market, the euro bought $1.2285, up from $1.2224 late Thursday. The dollar bought ¥111.10, down from ¥111.74 late yesterday.  

-- from staff and wire reports