U.S. Treasury yields moved higher on Tuesday as investors weighed new data about inflation and the economy.
The yield on the benchmark 10-year Treasury note rose as high as 1.8% before coming down a bit and was last 1 basis point higher at 1.793%. The yield on the 30-year Treasury bond rose 1 basis point to 2.115%. Yields move inversely to prices and 1 basis point is equal to 0.01%.
The move in yields came after the ISM Manufacturing purchases managers index for January showed slight growth and higher prices paid. The ISM Prices Index rose 7.9 percentage points to 76.1%.
The Federal Reserve has previously indicated that it would monitor the recovery in the labor market to help inform its plans for tightening monetary policy. The Fed signaled last week that it could start raising interest rates in March to combat higher inflation.
Joost Van Leenders, senior investment strategist at Kempen, told CNBC's "Squawk Box Europe" on Tuesday that he believed the Fed was coming close to "peak hawkishness."
"We're now discounting, I think, almost five rates hikes for this year," he said.
Van Leenders pointed out that there was also the possibility that the first rate hike could be an increase of 50 basis points, rather than the typical 25bps.
Indeed, Atlanta Fed President Raphael Bostic said in an interview with the Financial Times over the weekend that the Fed wasn't ruling out raising rates by half of a percent if inflation remains high.