(Updates yields, adds analyst comments) By Karen Pierog CHICAGO, Aug 30 (Reuters) - U.S. Treasury yields fell on Monday as the market looked ahead to the release later this week of the August employment report and the possibility it could factor into the timing of the Federal Reserve"s tapering announcement. The benchmark 10-year yield was last down 2.9 basis points at 1.2835%. Fed Chair Jerome Powell, in a speech last Friday that affirmed an ongoing U.S. economic recovery and explained why there is no rush to tighten monetary policy, gave a detailed account of why he regards a spike in inflation as temporary and offered no signal on when the central bank plans to taper its asset purchases beyond saying it could be "this year." Andrew Richman, senior fixed income strategist at Sterling Capital Management, said the jobs report due out on Friday could help sway Fed policymakers" decision on when to announce plans to decrease $120 billion in monthly purchases of Treasuries and mortgage-backed securities. "I think this number could move the scales a little bit one way or another here," he said. "If we get a very, very strong number this Friday, you could hear a tapering announcement more likely in September." The bond market could "rally a bunch" on a really bad nonfarms payrolls number, according to Ellis Phifer, managing director in fixed income research at Raymond James, who added that he didn"t think there was "a lot of positioning that"s way out of line ahead of Friday." Otherwise, the analysts said they expected relatively quiet conditions as the market heads toward the Labor Day Holiday weekend. The five-year note yield, which is more sensitive to intermediate interest rate hikes, was last down 2.9 basis points at 0.7708%. It touched a more-than-seven-week high of 0.864% on Friday. The breakeven rate on 10-year Treasury Inflation-Protected Securities rose to 2.416%, its highest level in a month, before falling to 2.373%. A closely watched part of the yield curve that measures the gap between yields on two- and 10-year Treasury notes was last about a basis point flatter at 108.02 basis points. August 30 Monday 3:00PM New York / 1900 GMT Price Current Net Yield % Change (bps) Three-month bills 0.045 0.0456 -0.007 Six-month bills 0.05 0.0507 0.000 Two-year note 99-216/256 0.2033 -0.014 Three-year note 99-238/256 0.3989 -0.021 Five-year note 99-230/256 0.7708 -0.029 Seven-year note 100-96/256 1.0693 -0.030 10-year note 99-176/256 1.2835 -0.029 20-year bond 98-200/256 1.8231 -0.024 30-year bond 102-76/256 1.8991 -0.020 DOLLAR SWAP SPREADS Last (bps) Net Change (bps) U.S. 2-year dollar swap 9.25 0.50 spread U.S. 3-year dollar swap 12.25 0.00 spread U.S. 5-year dollar swap 8.75 0.25 spread U.S. 10-year dollar swap 1.75 0.25 spread U.S. 30-year dollar swap -26.75 0.25 spread (Reporting By Karen Pierogd; editing by Jonathan Oatis) Our Standards: The Thomson Reuters Trust Principles.