Treasury yields rise with focus on inflation and rate hikes

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U.S. Treasury yields rose on the first day of June on Wednesday as investors focused on rising inflation and interest rate hikes.

The yield on the benchmark 10-year Treasury note climbed 2 basis points to 2.8658% at 4 a.m. ET. The 30-year Treasury bond yield rose 1 basis point to 3.0664%. Yields move inversely to prices and 1 basis point equals 0.01%.

Rising prices around the world remain a major concern for investors, with eurozone inflation hitting 8.1% in May, data showed on Tuesday.

The effect of central bank interest rate hikes on economic growth also continues to worry investors. Federal Reserve Governor Christopher Waller said in remarks in Frankfurt, Germany on Monday that he would not “remove 50 basis point hikes” until he saw inflation coming closer. the central bank’s 2% target.

Will Hobbs, chief investment officer at Barclays Wealth & Investments, told CNBC’s “Squawk Box Europe” on Wednesday that looking at a number of inflation forecasts a year ahead, “the range up and down is as wide as we’ve seen it since the early 80s.”

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“So you’ve got this huge uncertainty about the inflation outlook, people don’t quite know yet if central banks are going to do enough, if we’re in this new inflation paradigm and that creates additional uncertainty in addition to a world economy that is shaken by gigantic forces,” he said.

As for the data releases due out on Wednesday, the April job vacancies and labor turnover survey is set to be released at 10 a.m. ET. May’s manufacturing data, as well as April’s construction spending figures, are also due out at 10 a.m. ET.

An auction is due to take place on Wednesday for £30bn worth of 119-day bills.

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