U.S. Treasury yields rose Monday as investors assessed the outlook for the U.S. economy and earnings season pressed on.
The 10-year Treasury yield was up 8 basis points to 3.604%. The 2-year Treasury yield climbed more 9 basis points to 4.194%. Yields and prices have an inverted relationship and one basis point equals 0.01%.
The rise in yields came as earnings season heated up, with results from Charles Schwab and a handful of financial sector names. The sector has come under pressure in recent weeks as the collapse of Silicon Valley Bank fueled a liquidity crisis.
Elsewhere, the latest New York area manufacturing report for April showed some economic strengths, fueling some concern that the Federal Reserve may have more work to do.
"What you're seeing from the bond market — it's keying off of incrementally better economic data, which is also suggesting that the Fed could still move forward with a rate hike," said Keith Lerner, Truist's co-chief investment officer.
Treasurys
More than 86% of traders are calling for a 25 basis point rate hike at the central bank's policy meeting next month, according to CME Group's FedWatch tool. It marks a stark contrast to about a month ago as Wall Street bet on a halt in tightening amid the turmoil rattling the banking sector.
The 2-year Treasury yield breached the key 4% level on Friday even though data published throughout the week indicated that inflationary pressures could be easing.