US Treasuries slumped, pushing yields sharply higher, after hotter-than-expected inflation data and comments from a key Federal Reserve official fueled bets that the central bank would need to deliver more aggressive interest rate hikes to cool inflation.
The two-year Treasury yield, which closely tracks expectations for Fed policy, surged 17 basis points on Tuesday. The two-year yield saw its biggest single-day jump since April 2025, when President Donald Trump’s unveiling of tariffs rocked financial markets.
