U.S. Treasury Yields Continue Higher As Markets Brace For Fed Rate Hike

Treasury prices fell further on Monday, pushing yields higher as expectations that the Federal Reserve will soon raise interest rates continued to drive financial markets. The yield on the 10-year U.S. Treasury note rose 1 basis point to 1.688%. The interest rate on the U.S. benchmark note on Friday climbed 5.7 basis points to 1.671%, it's highest level since June 23, the day of the Brexit vote. The rise in yields came after Boston Fed President Eric Rosengren on Friday said a "reasonable case can be made" for raising interest rates, fueling expectations a rate hike could happen as soon as next week. The CME FedWatch Tool is currently indicating a 24% probability of a tightening at the Fed's Sept. 20-21 meeting and an almost 60% chance for an increase in December. The yield on the 2-year Treasury note , which is most sensitive to Fed rate changes, gained 1 basis point to 0.7942% on Monday.