• 2-year Treasury yields +8.8 bps to 2.591%
  • 5-year Treasury yields +8.4 bps to 2.779%
  • 10-year Treasury yields +6.8 bps to 2.622%
  • 30-year Treasury yields +5.4 bps to 2.635%

The jump in yields yesterday sparked a move higher in USD/JPY, which is continuing today as price hit 124.00 before backing off slightly. Hawkish Fed talk was the main culprit as the battle between inflation and central banks is still the main focus of the market over the past few months.

As the Fed starts to posture more aggressively, it is going to be a challenge for yields to keep lower especially when the inflation outlook continues to be rather ominous. There is almost little signs of price pressures cooling across the globe and the impact of the Russia-Ukraine conflict will only serve to exacerbate that. Throw in lockdowns in China and you have a recipe for worsening supply issues - which have been the root cause of what has transpired since the pandemic began.

The technicals also aren't looking pretty. Here's a look at 10-year Treasury yields:

There really isn't much in the way of a continued shove towards 3% potentially and that will be quite something. Most market participants had pinned 2% for some point this year but to see a blowout such as this in such a short period of time has been quite remarkable.

The question in the bigger picture now though is, has the bubble finally popped? For reference: