Strong US Jobs Data Jolts Bond Markets: Treasuries Slump as Yields Spike

Market snapshot: The US Treasury market witnessed a significant sell-off across all maturities on February 11, 2026, following a surprisingly robust labor market report. Non-farm payrolls for January increased by 130,000, nearly double the consensus estimate of 65,000–70,000. This resilience in employment, despite recent government shutdown concerns, has led investors to aggressively recalibrate expectations for Federal Reserve interest rate cuts, pushing bond yields higher and prices lower.

Summary: US Treasuries slumped as January jobs growth (130k) significantly outperformed expectations (65k), driving the 10-year yield up to 4.192% and signaling potential delays in Fed rate easing.

Key Takeaways

• January non-farm payrolls came in at 130,000, far exceeding the 65,000 forecast.
• The US unemployment rate unexpectedly dropped to 4.3% from the previous 4.4%.
• Benchmark 10-year Treasury yields rose by 4.7 basis points to reach 4.192%.

SAHI Perspective

For Indian markets, a slump in US Treasuries (rising yields) typically triggers a 'risk-off' sentiment among Foreign Portfolio Investors (FPIs). We expect localized pressure on the Indian 10-year G-Sec yield as the spread narrows. However, India's robust macroeconomic buffers and recent lower-than-expected state government bond supply (₹130 billion vs ₹386 billion estimated) may provide a cushion against extreme volatility.

Closing Insight

While the US jobs beat signals a delayed easing cycle, the Indian debt market's strength will depend on domestic fiscal discipline and the upcoming FY27 federal budget outcomes.

High Performance Trading with SAHI.