U.S. Treasury yields rose Tuesday, climbing to their highest levels since before the COVID-19 pandemic took hold in the U.S., as investors anticipate a growth boost from $1.9 trillion fiscal relief passed under the Biden administration and widening vaccine distributions.
What are Treasurys doing?
The 10-year Treasury note yield TMUBMUSD10Y,
See: U.S. Treasury debt markets on pace for worst quarter since 2016
What’s driving Treasurys?
Broadening access to COVID-19 vaccines announced by U.S. President Joe Biden and other state governments is giving a sense that the end of a devastating pandemic is in sight. Biden said 90% of the U.S. population will be eligible for the coronavirus vaccine by April 19.
Biden is also set to unveil a two-part infrastructure package on Wednesday that, if passed, would fuel the U.S. economic engine.
Hopes of a robust and swift recovery have gained ground in the past few weeks, sending yields for long-term government bonds to their highest levels in over a year.
At the same time, investors also remain unnerved by the pace of the rise, which have helped take some of the froth out of some corners of U.S. equity markets. Stock-market futures were pointed lower on Tuesday.
In U.S. economic data, the Case-Shiller national home price index for January will come out at 9 a.m. Eastern, followed by a gauge of consumer confidence for March at 10 a.m.
What did market participants say?
“Economic confidence is growing for the quarters to come and ahead of Biden’s speech tomorrow on infrastructure are the main reasons today for the rise,” said Peter Boockvar, chief investment officer at the Bleakley Advisory Group.
