The yield on the 10-year Treasury note jumped for a second consecutive day as investors weighed the path ahead for interest rates and the notion that cuts may come later than expected.
The yield on the 10-year Treasury rose by more than 13 basis points to 4.168%. The 2-year Treasury yield jumped nearly 11 basis points to 4.478%.
Yields and prices have an inverted relationship and one basis point equals 0.01%.
Treasurys
Fresh data out Monday showed the U.S. services sector expand at a faster-than-expected clip in January and grow for 13th consecutive month. The findings contributed to the move higher in yields.
Investors also weighed the road ahead for interest rates as Federal Reserve Chair Jerome Powell reiterated that the central bank would be careful when it comes to interest rate cuts and that the pace of rate cuts would likely be slower than markets are expecting.
Many investors have been hoping for the Fed to cut rates sooner rather than later as concerns about the impact of elevated rates on the economy have continued.
However, traders have turned more cautious on the prospect of rate cuts in recent days after the Fed kept interest rates unchanged for the fourth time in a row, and indicated that rate cuts are unlikely to begin in March.
As of Monday afternoon, the probability of a March rate cut has decreased to 16.5%, according to CME Group's FedWatch tool.