Investing.com – Bonds sold off on Monday, driving the yield on the U.S. 10-year Treasury to beyond 2.5% for the first time since October 2014.
Specifically, the U.S. 10-Year hit an intraday high of 2.528%, after closing Friday at 2.464%. Bond yields move inversely to prices.
The move came ahead of the Federal Reserve’s (Fed) monetary policy decision with markets convinced that the U.S. central bank will hike rates for the first time this year.
Additionally, an agreement between Organization of the Petroleum Exporting Countries (OPEC) and other producers to jointly cut output for the first time since 2001 also spurred speculation that higher oil prices would imply higher levels of inflation, sending bond yields higher.
Elsewhere, euro zone bond yields were also hitting their highest level since the beginning of the year.
Yields on the Germany 10-Year and the France 10-Year hit an 11-month high of 0.422% and 0.922%, respectively.
In peripheral debt, the Portugal 10-Year was eyeing 4%, while the Italy 10-Year approached highs not seen since July 2015.
In the U.K., the yield on the benchmark UK 10-Year hit 1.5% on Monday, its highest level since the country voted to leave the European Union.
U.S. debt sold off for a third-day running ahead of bond auctions later on Monday. The U.S. plans to auction 3-month and 6-month bills at 11:30AM ET (16:30GMT), followed by 3-year and 10-year notes at around 1:00PM (16:00GMT).