U.S. Treasury yields were higher Monday as investors considered what could be next for interest rates and awaited fresh economic data due this week.
The yield on the 10-year Treasury rose by more than 10 basis points at 4.542%, reaching its highest level since 2007 when it climbed as high as 4.57%. The 2-year Treasury yield was flat at 5.127%.
Yields and prices have an inverted relationship and one basis point equals 0.01%.
Treasurys
Moody's Investors Service warned in a note Monday that a U.S. government shutdown would be a "credit negative" event for the country.
Investors considered what lies ahead for the economy and interest rates after the Federal Reserve released its expectations for a wide range of economic indicators and monetary policy last week.
The central bank is expecting to hike rates once more this year, and to implement just two rate cuts in 2024, fewer than previously expected. Investors are therefore now expecting rates to remain higher for longer and considering whether another rate hike will be announced in November or December, which is when the two Fed meetings left this year will conclude.
A factor that could play into this is a potential shutdown of the U.S. government, which would begin on Oct. 1 if Congress is unable to resolve ongoing federal budget negotiations. The situation remains tense as little progress appeared to be made over the weekend.
This week, investors will be looking to data from the housing sector, as well as the Fed's favored inflation gauge, the personal consumption expenditure price index, on Friday. Various Fed speakers are also due to give remarks and could provide fresh hints about the monetary policy outlook.
— CNBC's Jesse Pound contributed to this report.