US Treasury yields rose on Tuesday as investors waited for the release of a new batch of economic data on the first trading day of the week.
Yield on Benchmark 10 year treasury note was about 3 basis points higher at 3.269%, while the yield on 30 Year Treasury Bond Traded up 4.5 basis points at 3.339%. Yields move inversely to prices.
US markets were closed on Monday due to the June holiday.
Tuesday’s trading session comes after a volatile week with major central banks signaling a more aggressive effort to contain rising inflation.
Federal Reserve on Wednesday raised its benchmark funds rate by 75 basis pointsThe increase is the biggest since 1994, with annual US inflation running at a 40-year high of 8.6% in May.
Swiss National Bank then surprised market with its first rate hike in 15 years on Thursday, while the Bank of England Implemented its fifth consecutive hike,
“The Fed will continue to hike rates until inflation subsides,” wrote Joe Kalish, chief global macro strategist at Ned Davis Research.
“First is the liquidity and functioning of the financial markets,” he said. “Continued highs and companies’ inability to tap capital markets will give the Fed a red light.”
Kalish said, “Next are financial conditions that signal a recession. These include credit spread out and bearish bear markets for stocks. Credit spreads are still giving the Fed the green light, while stocks are glowing in the yellow.” It is,” said Kalish. “The last is rising unemployment. Although the job market is still considered tight, claims of fewer job openings and rising unemployment could soon flip this yellow.”
On the data front, the Philadelphia Fed non-manufacturing survey for June will be released at approximately 8:30 a.m. ET, with the current home sales session for May set to follow a little later.
— CNBC’s Samantha Subin and Elliot Smith contributed to this report.