U.S. employment data may determine the success or failure of the Federal Reserve's rate hike in September

Bond traders are bracing for Friday's U.S. jobs report, as market pricing suggests a more than 50% chance of a Federal Reserve rate hike in September. Economists expect about 80,000 new jobs will be created in July. A strong report, especially higher wage pressures, could boost interest rate hikes and push Treasury yields higher. Weak jobs data could reduce those bets. Next week's U.S. inflation data will provide another key signal for the Fed's next move.