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Bonds rally on weak jobs report
Inflation concerns ease as government says 146,000 new jobs created; analysts had expected 200,000.
February 4, 2005: 9:47 AM EST

NEW YORK (CNN/Money) - Bonds rallied Friday after a government report showed the number of jobs created in January was well below analysts' forecasts. The dollar was mixed.

The benchmark 10-year note jumped 20/32 of a point to 101-9/32 to yield 4.09 percent, down from 4.14 Wednesday.

The 30-year bond surged 1-11/32 points to 113-9/32 to yield 4.50 percent, down from 4.58 late Thursday. Bond prices and yields move in opposite directions.

The five-year note added 14/32 to 99-26/32 to yield 3.67 percent, and the two-year advanced 5/32 of a point to 99-23/32, yielding 3.27 percent.

"The numbers today allay any concern that the Fed may adopt a more aggressive stance on interest rates," said Anthony Crescenzi, chief bond market strategist at Miller Tabak & Company. "The employment gains we've seen of late remain modest by historical standards."

The Labor Department report showed employers added 146,000 jobs in January, up from a revised 133,000 the previous month. Economists surveyed by Briefing.com forecast a net gain of 200,000.

Fewer jobs added means less pressure on the labor market to drive up wages, which could contribute to inflation. Bond investors fear inflation as it erodes the value of the fixed-interest paying investment.

The euro bought $1.3030, up form $1.2973 late Thursday. The dollar bought ¥103.56, down from ¥104.44.  Top of page

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