NEW YORK — US Treasury yields were modestly higher on Wednesday as fiscal concerns about President Donald Trump’s tax and spending legislation seemingly outweighed the likelihood of a Federal Reserve rate cut following an unexpected drop in private-sector jobs last month.
“The focus is shifting back to deficit spending and the potential for inflation to rise,” said Zachary Griffiths, head of investment grade and macro strategy at CreditSights in Charlotte, North Carolina. “I feel like the overall labor market data this week has been inconsistent with JOLTS (Job Openings and Labor Turnover Survey), which came out relatively strong yesterday and then ADP (private sector jobs report). So tomorrow’s nonfarm payrolls print will be key.”
Republicans in the House of Representatives, meanwhile, teed up a procedural vote on Trump’s massive tax-cut and spending bill that could reveal whether the party has enough support to pass it out of Congress. With only three votes to spare, it was not clear whether Republicans would be able to resolve the concerns of a handful of members who have threatened to vote against the News Story. A procedural vote was set for early afternoon, with a vote on final passage possible later in the day.
