Treasury Yields Near 5% as Oil Prices Soar and Fed Rate-Hike Bets Rise

The U.S. 10-year Treasury yield has climbed to 4.97% on September 11, nearing the closely watched 5% level as oil prices surge above $110 a barrel and Federal Reserve interest-rate hike bets rise.

Oil prices have reached a four-month high, with Brent crude up roughly 13% for the week due to continued attacks and disruptions along major Middle East shipping routes.

As a result of these price increases, inflation fears are growing, particularly ahead of closely watched U.S. inflation data and the Federal Reserve's next policy meeting.

The increased probability of a Fed rate hike has seen traders pricing in roughly a 72% chance of an interest-rate increase next week, up sharply from about 49% one week earlier.