U.S. Treasury yields rise as negative sentiment in bonds holds
TLT•U.S. Treasury yields rose as investors weighed services data, rate expectations and upcoming auctions. The 10-year yield rose 5.1 basis points to 5.328%, while traders priced a 76% chance the Federal Reserve would hold rates steady at its October meeting.
1. Yields move higher
U.S. Treasury yields rose modestly as negative sentiment in the bond market persisted. Investors digested a report showing U.S. services activity slowed in September, while the 10-year yield rose 5.1 basis points to 5.328% and the 30-year yield increased 5.3 basis points to 5.683%.
2. Rate expectations and auctions
Traders priced a roughly 76% probability that the Federal Reserve would leave rates unchanged at its October 27-28 meeting, and nearly a 90% chance of a December hike. Investors were also watching upcoming Treasury auctions, including a 3-year sale on Tuesday; a recent $70 billion 5-year note auction drew weak demand.
