US Treasury Yields Climb as Rate Hike Fears Reignite

US Treasury yields rose on Tuesday as investors weighed falling oil prices against expectations of further interest rate hikes by the Federal Reserve. The yield on the 10-year US Treasury note reached a fresh two-year high of 4.7879%, indicating market expectations for Fed interest rate changes.

The Fed raised rates last week for the first time since 2023 in an effort to control inflation, and traders now see a 53% probability of another rate increase at the central bank's October meeting, according to CME FedWatch.

Boston Fed President Susan Collins supported the central bank's decision to raise rates due to risks that future inflation will exceed the 2% target.