US Yields Edge Higher Amid Fed Rate Hike Expectations

US Treasury yields rose slightly on Tuesday as investors weighed lower oil prices against expectations for further interest rate hikes from the Federal Reserve.

The two-year US Treasury yield, which is closely tied to Fed rate hike expectations, hit a fresh two-year high at 4.7879 percent.

The Fed last week raised rates for the first time since 2023 in an effort to control inflation, with traders seeing a roughly 53 percent chance of another increase when the US central bank next meets in October, according to CME FedWatch.

Boston Fed President Susan Collins supported the decision to raise rates, writing on LinkedIn that she believed it was necessary to address risks that future inflation would be above the 2 percent target.