U.S. Treasury yields continued to climb on Tuesday as traders eyed the possibility of further economic stimulus.
The yield on the benchmark 10-year Treasury note rose to 1.174%, its highest level since March 20. The yield on the 30-year Treasury bond reached 1.904%, also a level last since in March. Yields move inversely to prices.
Treasury yields moved higher, following President-elect Joe Biden’s promise last week of further economic stimulus “in the trillions of dollars.” More details will follow in a formal announcement on Thursday.
House Democrats introduced an article of impeachment Monday against incumbent U.S. President Donald Trump for inciting a mob of his supporters who invaded the U.S. Capitol last week.
Atlanta Federal Reserve President Raphael Bostic said Monday interest rates could rise sooner than forecast as the economy recovers more quickly than expected from the throes of the Covid-19 damage. Bostic said rate increases could begin by mid-2022 or early 2023.
“There is a building concern that the vaccine and reflationary optimism has allowed the Fed to begin the conversation regarding tapering QE purchases sooner than might otherwise have been the case,” Ian Lyngen, BMO’s head of U.S. rates, said in a note on Tuesday. “For the time being, the takeaway appears to be a market content to discount the potential implications as simply too far off on the horizon.”
Auctions will be held Tuesday for $30 billion of 119-day bills, $30 billion of 42-day bills and $38 billion of 9-year 10-month notes.
— CNBC’s Jacob Pramuk contributed to this report.
