Yields on U.S. government bonds have surged back to their highest levels since 2019, reflecting investors’ growing bets that Russia’s invasion of Ukraine won’t slow the momentum toward higher interest rates.
The yield on the benchmark 10-year U.S. Treasury note settled at 2.139%, up from 2.004% Friday and its highest close since June 2019.
Yields, which rise when bond prices fall, had climbed sharply over the first six weeks of the year as investors ratcheted up their expectations for interest-rate increases from the Federal Reserve. They then fell—with the 10-year yield settling as low as 1.722%—as Russia’s invasion sent cash flowing into safer assets.
But yields have rebounded over the past week, with investors increasingly nervous that the isolation of Russia will add to inflation by boosting commodity prices.
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