10-Year U.S. Yield Surge to Highest Level since 2011



The yield on the 10-year Treasury note rose on early Tuesday to reach levels since 2011 after a solid retail sales figures underlined the economy's stable momentum.

The rally in yield comes amid resurgent concerns that negotiations between the U.S. and China continue to be challenged, stoking concerns that a potential trade war could drive up prices and inflation higher- which has negative implication for bonds.

Yield on the 10-year Treasury note yield surged 7.5 basis points to 3.070 percent, the highest since July 2011, and notching its biggest single-day increase March 1, according to WSJ Market Data Group. The yield reached an intrasession high at 3.093 percent, according to FactSet data.

The 30-year bond yield rose 8.1 basis points to 3.210 percent, the biggest one-day increase since February 2. The short-dated two-year note yield rose 3.9 basis points to 2.585 percent, extending a yield move close to a decade peak.

The day's trading helped to increase the yield gap between two-year and the 10-year rate to 48.5 basis points.

The threat of increasing borrowing rates have given investors in risky assets a reason to pause, with the benchmark 10-year note again tested the yield level above 3 percent, which have previously caused friction in markets, challenging investors' appetite for assets perceived as risky against safe haven assets such as bonds.

Prime News are provided byInstaForex.