NEW YORK, April 7 ― Treasuries climbed from last place among the world’s bond markets as investors bet employment growth is slow enough to keep the Federal Reserve from raising interest rates this year.

Future contracts indicate traders expect the central bank to raise US borrowing costs in September 2015. The Fed is scheduled to issue the minutes of its March meeting on April 9, after using the session to make a third cut to the debt-purchase program designed to support the economy. Treasuries rose April 4 after a report showed US added 192,000 jobs last month, versus 200,000 projected by a Bloomberg News survey of economists.

“The market was expecting a stronger number,” said Ali Jalai, a bond trader in Singapore at Scotiabank, a unit of Bank of Nova Scotia, one of the primary dealers that underwrite the US debt. “The Fed will continue to taper, and probably next year they will start to tighten.”

Benchmark 10-year yields were little changed at 2.72 per cent as of 12:12 pm in Tokyo, according to Bloomberg Bond Trader prices. The price of the 2.75 per cent security due in February 2024 was 100 1/4.

US government securities due in more than a year were little changed in the month ended April 4, ranking No. 13 of 26 debt indexes around the world compiled by Bloomberg and the European Federation of Financial Analysts Societies. They were in last place in the month ended April 3, the day before the jobs report.

Japan’s 2024 yield slid two basis points, or 0.02 percentage point, to 0.62 per cent. Last week’s high of 0.65 per cent was the most since January 23. The BOJ starts a two-day policy meeting today. Australia’s yield slid seven basis points to 4.08 per cent, the biggest decline in three weeks.

Jobs potential

Fed Chair Janet Yellen said last month the central bank may raise borrowing costs six months after ending its buying programme. It has kept the target for overnight lending between banks in a range of zero to 0.25 per cent since 2008.

The implied yield on 30-day federal fund futures contracts expiring in September 2015 was 0.53 per cent, indicating investors expect the target to be higher by then.

International Monetary Fund Managing Director Christine Lagarde said US jobs growth is “not at potential.”

The employment numbers “could be and they should be higher,” Lagarde said on Fox News, based on a transcript released on April 5. “What is holding us back is probably a degree of uncertainty, a lack of confidence, the fact that a lot of companies are investing into themselves more than actually investing into capacity and in job creation.”

Yields may move higher as investors prepare to bid for US$64 billion (RM209 billion) of notes and bonds the Treasury Department is selling this week, Bank of Nova Scotia’s Jalai said.

The US plans to sell US$30 billion of three-year notes tomorrow, US$21 billion in 10-year debt the next day and US$13 billion of 30-year bonds on April 10. ― Bloomberg View