The 10-year U.S. Treasury yield topped 2.34% on Tuesday morning, following hawkish comments made by Federal Reserve Chairman Jerome Powell in the previous session.
The yield on the benchmark 10-year Treasury note rose 3 basis points to 2.3478% at 5 a.m. ET. The yield on the 30-year Treasury bond climbed 3 basis points to 2.5672%. Yields move inversely to prices and 1 basis point is equal to 0.01%.
Treasurys
Powell said in a speech on Monday that “inflation is much too high.”
He said the Fed would continue to raise interest rates until inflation is under control, and that hikes could get even more aggressive than last week’s 25 basis point increase.
Powell acknowledged that Russia’s invasion of Ukraine was adding to supply chain and pricing pressures, saying that policymakers need to be wary of the situation.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said on Tuesday that “caught between a rock and a hard place, the Federal Reserve sees little option but to try and chip away inflation with even bigger interest rate hikes this year, if price pressures keep mounting.”
Talks between Russia and Ukraine have so far failed to make progress. On Monday, Ukraine rejected an ultimatum to surrender its besieged port city of Mariupol to Russian forces.
President Volodymyr Zelenskyy told Eurovision News that ultimatums won’t work as trapped Ukrainians will “fight till the end.”
Investors are also keeping an eye on the spread of an omicron subvariant across Europe, along with China’s worst Covid-19 outbreak since the beginning of the pandemic.
There are no major economic data releases slated for Tuesday.
An auction is scheduled to be held on Tuesday for $34 billion of 52-week bills.
— CNBC.com staff contributed to this market report.
