Google Bond Sale and Fed Rate-Hike Report Push US Yields Higher

US Treasury yields climbed in early New York trading as investors absorbed Google's launch of a 10-part bond sale and a report that Federal Reserve Chairman Kevin Warsh is prepared to raise interest rates at the September meeting if upcoming inflation data runs hot. The 10-year yield rose roughly 3.5 basis points to about 4.65 percent. Yields across maturities were up 3 to 4 basis points, with long-dated bonds leading the decline in prices. Google's offering weighed on the long end of the curve, pushing the 2s10s and 5s30s spreads to their widest levels of the session. Short-term yields also moved higher after the report. The 2s10s and 5s30s curves steepened by about 1 basis point. Google's bond sale spans maturities from two years to forty years. Rate markets continue to price in about 15 basis points of tightening for September, with cumulative expectations near 33 basis points by year-end. The report on Warsh adds to pressure on short-dated notes, as traders weigh the possibility of another hike.