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Treasury yields rise after Powell testimony

U.S. Treasury note yields rose on Wednesday after  Federal Reserve Chairman Jerome Powell's second day testifying in front of Congress. 

The two-year note yield traded at 2.615 percent. Earlier in the session, it hit 2.624 percent, its highest level since Aug. 6, 2008. The yield on the benchmark 10-year Treasury note rose to 2.88 percent, while the yield on the 30-year Treasury bond was also higher at 2.997 percent.

U.S. Markets Overview: Treasurys chart

Powell testified in front of the House Financial Services Committee, reiterating remarks he made in front of the Senate Banking Committee on Tuesday.

"Overall, we see the risk of the economy unexpectedly weakening as roughly balanced with the possibility of the economy growing faster than we currently anticipate," Powell said Tuesday, noting that growth in the second quarter was "considerably stronger than in the first."

The Fed chairman also said the economy was strong enough to handle tighter monetary policy.

"The big takeaway (from the testimony) is consistency," said James McCann, senior global economist at Aberdeen Standard Investments. "We are getting a pretty consistent line of thinking regarding monetary policy."

"A lot of this was sort of reiterating that they want to move policy in a predicable manner," he said. McCann added that while Powell reiterated the Fed's gradual approach to raising rates, he left the door open for changes in case the economy slows down. 

The Fed has forecast it will raise rates two more times in 2018, having already tightened policy twice this year.

U.S. housing starts fell , the Commerce Department said. The percentage drop was also the biggest since November 2016. According to Bespoke Investment Group, it was the biggest miss relative to expectations since January 2007. Mortgage applications also , the Mortgage Bankers Association said.