The 10-year U.S. Treasury yield rose above 1.7 percent, the highest level since January 2020, to a high of 1.73 percent; the 30-year Treasury yield also jumped to 2.5 percent, the highest level since August 2019.
Last month’s disappointing U.S. Treasury auction triggered selling pressure on Treasuries, and even after the Federal Reserve said it plans to keep interest rates low through 2023, the killing effort has not been eliminated, setting the stage for yields to continue climbing.
Sebastien Galy, senior macro strategist at Nordea Investment Funds SA, said the 10-year Treasury rate is likely to rise to 1.8 percent in the near term. “Rising Inflation in the medium term and the fact that the Fed may have to scramble to catch up in the future if the economy stays on hold under strong performance are two factors that could be related to the sell-off in the bond market.”
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