The yield on the benchmark US 10-year Treasury touched a fresh seven-year high in early Asia-Pacific trading on Thursday after surging on strong US economic data earlier in the week.
Ten-year US Treasury yields rose 1 basis point to 3.106 per cent on Tuesday, their highest since July 2011. Yields move inversely to price. Those on the Australian equivalent were up 2 basis points at 2.895 per cent and ten-year Japanese government bond yields were flat at 0.047 per cent.
“Even as we are wary to read too much into the day-to-day movements of the [US Treasury] yields, it is also important to recognise that US equities overnight moved higher and we believe the robust [first quarter]earnings are helping investors to focus on the positives,” JPMorgan Asset Management strategist Tai Hui said.
On Tuesday the US 10-year jumped 9 basis points to 3.0926 per cent – just shy of a seven year high – following the release of a solid US retail sales report, which rekindled speculation that the Federal Reserve might raise interest rates more aggressively than previously thought in 2018.
The dollar index, which measures the greenback against a basket of major currencies and hit its highest in 2018 on Wednesday, was off 0.1 per cent in Asia trading.