The yield on the 10-year US Treasury note jumped seven basis points to 2.53 percent yesterday, the highest level since March 22, as trade optimism and a breakthrough for Brexit triggered a sell-off in the safe haven bonds.
White House economic adviser Larry Kudlow said Wednesday that the US and China made good headway in trade talks last week, reinforcing expectations of the trade deal. Meanwhile, British lawmakers voted out hard Brexit by approving Cooper's Brexit delay bill.
As a result, risky assets picked up a bid - the Dow Jones Industrial Average rose 39 points to end the day at 26,218.
The risk-on seems to have hit the Asian shores, as the major indices like Nikkei, S&P/ASX 20, Kospi, and Hang Seng are flashing green.
Hence, Treasury yields may rise further. As of writing, the 10-year yield is trading at 2.515 percent - up eight basis points from the 3-month yield of 2.42 percent. The curve between the two had inverted last month, triggering recession fears.