Treasury yields rise as investors assess inflation outlook

U.S. Treasury yields climbed on Monday as the trading week began and investors considered the outlook for inflation and awaited key economic data.

At 5:22 a.m. ET, the yield on the benchmark 10-year Treasury note was up by almost 3 basis points to 3.599%. The 2-year Treasury traded around 4.28% after rising by about 2 basis points.

Yields and prices have an inverted relationship and one basis point is equivalent to 0.01%.

Investors continued to assess the outlook for inflation and how that could affect the Fed’s next interest rate decision. The central bank is due to meet on Jan. 31 and Feb. 1, and investors are considering whether rate hikes will be slowed further as the Fed’s battle with persistently high inflation continues.

The central bank last increased rates by 50 basis points at its December meeting, a slight slowdown from the 75 basis point hikes it had implemented at each of its previous four meetings.

On Friday, December’s nonfarm payrolls report indicated that inflationary pressures could be easing as it showed that wages grew by less than expected throughout the month. The report also showed that that the economy added 233,000 jobs in December, more than the 200,000 previously estimated by Dow Jones.

Investors are hoping to gain more clarity about inflation this week as December’s U.S. consumer price index figures are due on Thursday.

Before then, several smaller data points are expected, including the consumer inflation expectations report on Monday. Several Fed officials are due to make remarks.

This report’s information was first seen on CNBC; to read more, click this link.