Yields on benchmark U.S. government debt hit a near eight-month high on Thursday on signs of growing doubts within the Federal Reserve on its bond-buying program and after stronger-than-expected private jobs data lifted hopes for Friday's labor figures.
While the Fed said it would keep up its stimulus program in place to boost the economy over coming months, minutes of its December meeting underscored an increasing reticence about further expanding the central bank's $2.9 trillion balance sheet.
"Several (officials) thought that it would probably be appropriate to slow or to stop purchases well before the end of 2013, citing concerns about financial stability or the size of the balance sheet," the minutes said.
Ten- and 30-year U.S. government debt sold off sharply after the document was released, with yields on the benchmark 10-year note breaking through their range of the past five months.
"I think the bottom line is that the policy is likely to be in place for a while, but the minutes seems to be raising some doubts about the commitment to the policy," said Julia Coronado, chief North America economist at BNP Paribas in New York.
"This is going to be an ongoing issue for the Fed," she added. "We're in uncharted waters."
Prices for 10-year debt were down 20/32 after the minutes to yield 1.904 percent, up from 1.84 percent late on Wednesday. Yields spiked up as far as 1.91 percent, the highest since May.
Yields on 10-year notes posted their biggest two-day rise since Aug. 14-15, when concerns over continuing deterioration in the euro zone eased following a pledge from European Central Bank President Mario Draghi to do whatever it would take to preserve the euro.
Ten-year U.S. debt is considered a benchmark for a number of borrowing instruments, including mortgage rates.