NEW YORK, Oct 18 (Reuters) - U.S. Treasury yields fell

on Friday as the market consolidated following large yield

increases over the past month as investors price in a less

dovish Federal Reserve due to the U.S. economy remaining

stronger than previously expected.

Traders priced out the odds of an additional 50 basis point

interest rate cut by the U.S. central bank after data showed

much stronger jobs gains than expected in September. Fed Chair

Jerome Powell has also pushed back against the likelihood of

further large cuts.

Traders are now focused on the outcome from the Nov. 5 U.S.

presidential election, geopolitical tensions in the Middle East

and the strength of riskier asset markets.

"The market is decidedly in the mode of consolidation;

there's not any obvious potential triggers on the horizon," said

Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets

in New York.

However, it is "poised to respond to external influences.

Those could come in the form of moves in the equity market,

moves in credit, geopolitical concerns or even the progress

towards the presidential election," Lyngen said.

Benchmark 10-year yields were last down 2.3

basis points at 4.073%. They reached 4.12% on Oct. 10, which was

the highest since July 31 and are up from 3.599% on Sept. 17,

the lowest since June 2023.

The 10-year yields are now pushing up against the 200-day

moving average at 4.17%, but have so far failed to cross above

it.

Interest rate-sensitive two-year yields fell 3.7

basis points to 3.95%.

The yield curve between two-year and 10-year notes

steepened 1 basis point to 12.1 basis points.