The yield on the two-year Treasury note hit its highest level in nine years on Monday as investors grew confident that sustained military action in Syria would not materialize and retail sales data proved stronger than expected.
Earlier, the two-year yield hit 2.394 percent, its highest level since Sept. 8, 2008, when the two-year yielded as high as 2.542 percent.
The Commerce Department said Monday that retail sales in March bounced back 0.6 percent, its largest increase since November. The swell in retail sales was largely thanks to consumer purchases of automobiles, furniture and appliances after three months of declining retail sales, the department added.
Sales rose at grocery stores, restaurants and bars as well as drug stores. They fell at home and garden shops as well as clothing and sporting goods stores.
"The overall [retail sales] number was a little bit stronger than expected and excluding auto sales it was as expected. It's enough to support the story that the economy is kind of moving along," said Arthur Bass, managing director of fixed income financing, futures, and rates at Wedbush Securities. "The key to the markets is still the risk-on, risk-off trading, and fixed incoming traders are keeping an eye on the equity market."
Investors also grew more confident in the economy as fears of sustained military involvement in Syria eased. The U.S., France and Britain launched more than 100 missiles Saturday that targeted facilities in Syria in what leaders have described as an isolated, precise attack.
Secretary of Defense James Mattis called the strikes a "one time shot" and said that they were aimed at Syrian government's chemical weapons infrastructure. "Right now we have no additional attacks planned," Mattis said from the Pentagon.
The strikes came on the heels of an alleged chemical weapons attack believed to be carried out by forces aligned with the Assad regime in Douma, a town that was held by Syrian rebels.
The Pentagon also described the U.S.-led strikes as a "justified, legitimate and proportionate response" to the Syrian regime's continued use of chemical weapons.
In central bank news, Atlanta Fed President Raphael Bostic will be speaking at the Shoals Chamber of Commerce in Florence, Alabama, while Dallas Fed President Robert Kaplan will be in Florida at the International Economic Forum of the Americas World Strategic Forum.
—CNBC's Amanda Macias contributed to this report