The benchmark 10-year Treasury briefly topped 4% on Wednesday, reaching levels not seen since 2008, as markets took in Federal Reserve speaker commentary that hinted at further interest rate hikes.
The yield on the 10-year Treasury was up 3 basis points to 3.9945% at around 4:20 a.m. ET. Earlier in the day, it rose as high as 4.019%.
The yield on the policy-sensitive 2-year Treasury note fell. It was down 4 basis points to 4.2582%.
Yields and prices move in opposite directions. One basis point is equal to 0.01%.
Traders were rattled by a series of Fed speaker comments earlier in the week. Their broadly hawkish tone suggested to many analysts and investors that further interest rates hikes will be implemented.
This sentiment was echoed overnight by San Francisco Fed President Mary Daly, who said the central bank was “resolute” regarding lowering inflation.
Chicago Federal Reserve President Charles Evans struck a slightly different tone on Tuesday, telling CNBC’s “Squawk Box Europe” that he was concerned about the possibility of rates being hiked too quickly. Evans also said that he was still “cautiously optimistic” about being able to avoid a recession.
Traders are anticipating further economic commentary from Federal Reserve representatives that could give further indication of the central bank’s policy approach. This includes a speech from Federal Reserve Governor Michelle Bowman and Federal Reserve Chair Jerome Powell.
Home sales data for August is also due to be released.
Read More: 10-year Treasury yield tops 4%, soaring to 14-year high