Markets today: Bond yields hit 2024 highs with inflation in focus

The world’s biggest bond market kicked off the week on the back foot as geopolitical pressures abated and traders positioned for this week’s key inflation data.

Treasury 10-year yields rose to the highest since November and came within a striking distance of the 4.5 per cent level that some investors are watching as a threshold that could determine whether rates will revisit the 2023 highs. Traders’ conviction on three quarter-point rate cuts from the Federal Reserve this year is quickly dissipating, with markets now favoring just two reductions.

Economists surveyed by Bloomberg forecast Wednesday’s consumer price index will show some easing of inflation pressures. Yet the core gauge, which excludes food and energy costs, would be up 3.7 per cent from a year earlier — above the Fed’s 2 per cent target.