Strong U.S. employment data released September 4, with nonfarm payrolls surging 162,000 versus expectations of 56,000, drove 5-year Treasury yields higher to around 4.52–4.55% and increased market-implied odds of Federal Reserve policy tightening. Traders now focus on the upcoming inflation release as the next key input for rate path expectations, amid persistent price pressures and a resilient labor market. Broader upward pressure on yields stems from elevated Treasury supply, widening fiscal deficits exceeding 6% of GDP, and heavy corporate issuance tied to AI infrastructure spending, which has lifted term premiums. The 5-year yield has traded in a relatively narrow range near multi-year highs, with limited room for sharp declines absent clear disinflation signals or dovish Fed guidance.