US Treasuries widened losses on reports of Google's bond issuance plan and Fed rate hike expectations

Odaily News: US Treasuries came under pressure in early New York trading. Google announced the launch of a 10-part bond offering, weighing on the long end of the yield curve and pushing the 2s10s and 5s30s spreads to intraday highs. On the short end, reports suggested that Fed Chair Kevin Warsh "would be prepared to raise rates at the September meeting" if upcoming inflation data over the next few weeks runs hot.

Following the reports, short-term Treasury yields moved higher. Yields rose 3 to 4 basis points across the board, with long-dated bonds leading the decline. The 2s10s and 5s30s curves steepened by about 1 basis point to their widest levels of the day. The 10-year Treasury yield climbed to approximately 4.65%, up 3.5 basis points on the day. Google's bond issuance spans multiple maturities, ranging from the shortest at 2 years to the longest at 40 years. Rate markets currently price in around 15 basis points of rate hike expectations for September, with cumulative hike expectations of roughly 33 basis points by year-end.