U.S. Treasurys climbed on Thursday as investors considered the prospect of further interest rate hikes by the Federal Reserve and awaited fresh economic data.
At 4:23 a.m. ET, the yield on the benchmark 10-year Treasury was up by just over three basis points to 4.028%, trading above the 4% mark at levels last seen in early November.
The 2-year Treasury yield was last trading at 4.9017% after rising by more than one basis point. Earlier in the session it had risen as high as 4.937%, a level last seen in mid-2006 according to CNBC calculations based on Refinitiv data.
Yields and prices have an inverted relationship and one basis point equals 0.01%.
Investors considered the likelihood of further interest rate hikes and rates staying higher for longer.
On Wednesday, Atlanta Fed President Raphael Bostic published a statement saying he believed rates would need to go higher still and remain elevated “well into 2024” as the battle with inflation continues.
Meanwhile, Minneapolis Fed President Neel Kashkari indicated that further interest rate increases could be on the horizon and that the Fed may accelerate the pace of rate hikes again.
At its latest meeting, the central bank had hiked rates by 25 basis points. This marked a slowdown compared to the previous five increases which included four consecutive 75 basis point hikes followed by a 50 basis point hike.
Many investors have been concerned about the pace of rate hikes dragging the U.S. economy into a recession.
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