A stronger-than-expected labor report just crushed any hopes that the Federal Reserve would lower rates this month—despite speculation from Wall Street and direct demands from President Donald Trump.

Yields on long-term government debt are also up, steepening the yield curve and sending a signal that bond markets continue to be skeptical that the Federal Reserve will join Trump in pushing for rate cuts. The rise in borrowing costs reflects investor unease about both persistent inflation and the sustainability of U.S. fiscal policy.