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Bond Yields Lower Despite Strong Payrolls Report

Bond yields fell across the curve this week, with several factors pushing markets in different directions.  The week started off on a positive tone as the government shutdown ended, as Congress and the administration agreed on a three-week funding plan, which will keep the government open through February 15.  The Federal Reserve ended its much anticipated first meeting of the year by keeping the Fed funds rate target unchanged, as expected. 

In both the Committee's formal statement and in comments following the meeting, the FOMC pledged that future monetary policy decisions will be driven solely by incoming economic data.  The Fed removed all indications of future rate increases from it's statement, a factor which helped pushed bond yields lower.  Those declines persisted until Friday's strong payrolls report, which showed robust job growth in January.  Labor force participation also rose to its highest level since 2013.

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