U.S. government debt yields ticked upward on Monday after last week's tepid inflation measures.
The yield on the two-year Treasury note hit 2.547 percent, its highest level since Aug. 12, 2008, when the two-year yielded as high as 2.549 percent.
Last week, the Labor Department said import prices rose 0.3 percent last month. Data for March was revised to show import prices falling 0.2 percent instead of being unchanged as previously reported. Economists polled by Reuters had forecast import prices rising 0.5 percent in April.
Meanwhile, the consumer price index data rose 0.2 percent last month, below analyst expectations of a 0.3 percent increase.
The news lifted market expectations, easing concerns about the pace of the U.S. central bank's tightening strategy.
The Federal Reserve considers consumer pricing data when deciding whether to increase the benchmark federal funds rate. Despite the narrow CPI miss, personal consumption expenditures — the Fed's preferred inflation metric — is now near the central bank's target.
Rising inflation is a threat to Treasury prices because it erodes the purchasing power of their fixed payments, putting upward pressure on rates.
Meanwhile, in oil markets, Brent crude traded at around $76.89 a barrel on Monday morning, down 0.3 percent, while U.S. crude was around $70.51 a barrel, off by 0.25 percent.
Oil prices slipped away from multi-year highs on Monday, amid resistance from global players over the Donald Trump administration's sanctions against major oil exporter Iran. Energy market participants fear a sharp fall in Iranian crude supply once U.S. sanctions bite later this year.