Treasury yields climbed on Friday as stronger-than-expected economic data fueled speculation about future monetary policy. The yield on the benchmark 10-year Treasury note rose to 4.87%, while the 2-year note yield increased to 5.05%.

The gains were primarily attributed to positive reports on manufacturing activity and consumer spending, which indicated continued economic expansion. These figures led some analysts to believe that the Federal Reserve might be more inclined to raise interest rates in the coming months to combat potential inflation.

Increased economic optimism typically causes bond yields to rise, as investors shift funds from the safety of government bonds into riskier assets, such as stocks. This move puts downward pressure on bond prices, which results in higher yields.

Furthermore, market participants are closely monitoring upcoming inflation data and statements from Federal Reserve officials for further clues about the direction of monetary policy.