Investors brace for 5% Treasury yields

Still high: Clothing for sale at a shopping mall in Chicago. There is evidence that inflation is heating up again with data showing that the PCE price index, excluding food and energy, has risen far more than expected in the first quarter. — AFP

AS US inflation worries grow, some investors are preparing for the 10-year US Treasury yield to breach a 16-year high of 5% hit last October.

Bond yields, which move inversely to prices, have climbed in recent weeks as signs of persistent inflation erode expectations for how deeply the Federal Reserve (Fed) will be able to cut interest rates without further fuelling consumer prices.