U.S. Treasury yields rose on Tuesday as investors remained wary of persistent inflation. The yield on the benchmark 10-year Treasury note climbed to its highest level in recent weeks, reflecting increased expectations of further monetary tightening by the Federal Reserve.

Economic data released earlier in the day showed continued strength in the labor market, further fueling concerns about wage inflation. This data has led investors to believe that the Federal Reserve will need to maintain its aggressive stance on interest rate hikes to bring inflation under control.

The 2-year Treasury yield, which is particularly sensitive to changes in the Federal Reserve’s policy rate, also saw a significant increase. Market participants are closely watching upcoming inflation reports and statements from Fed officials for clues about the future path of monetary policy.

Analysts suggest that the current market volatility reflects the uncertainty surrounding the economic outlook. While some indicators point to a potential slowdown in growth, inflationary pressures remain stubbornly high. This creates a challenging environment for policymakers as they attempt to balance the risks of recession and inflation.

The Treasury market will likely remain sensitive to economic data releases and Fed communications in the coming weeks. Investors will be looking for any signs that inflation is beginning to moderate, which could provide some relief to the bond market.