The 30-year yield reached 5.19% as investors weighed inflation, fiscal concerns and the outlook for interest rates.
US Treasury yields rose for a second day as investors prepared for Federal Reserve Chairman Kevin Warsh’s speech Friday at the central bank’s Jackson Hole gathering.
Yields increased one to two basis points across maturities, led by longer-dated bonds. The 30-year yield rose to 5.19% after reaching its highest level since 2007 earlier this month.
Investors are watching for a potentially hawkish tone from Warsh as the Fed weighs inflation and the US fiscal outlook. Apollo Global Management chief economist Torsten Slok said the speech could have a hawkish flavor.
Federal policymakers left the federal funds rate unchanged at 3.5% to 3.75% at their latest meeting. Futures markets are pricing one quarter-point hike by the end of the year and roughly a one-third chance of a September increase.
A purchase of 45,000 October federal-funds futures contracts suggested some traders do not expect a move before December. Yields remained higher after a $44 billion auction of seven-year notes drew solid demand.
The Treasury has announced increased buybacks of long-dated debt after the recent rise in yields. Jobless claims also declined from the previous week, according to Bloomberg.
