Treasury yields climbed on Monday as traders anticipate the Federal Reserve’s next moves in the face of persistently high inflation.
The benchmark 10-year Treasury yield gained 5 basis points to 3.5%, hitting its highest level since 2011. The yield on the 2-year Treasury bond rose 7 basis points to trade at 3.93%, trading around levels not seen since 2007.
Yields move opposite to prices. One basis point is equivalent to 0.01%.
The Fed’s two-day meeting is due to begin Tuesday, with most market participants expecting another 75-basis-point hike by the central bank. Some analysts have, however, argued the Fed could increase interest rates by a full point, or 100 basis points.
It comes after inflation rose more than expected in August. The consumer price index increased 0.1% for the month and 8.3% over the past year — higher than economists expected. The data has led investors to expect the Fed to double down on higher interest rates for longer, until prices fall.
— CNBC’s Jeff Cox and Jesse Pound contributed to this report
