US 10-year yields hit 2.91% in Europe and then backed off to 2.88% but a second push in early New York trade has cracked 2.92%, marking the highest since late-2019.
The latest leg in yields has been more of a grinding move than the initial bound higher but zooming out shows how quick the move has come from 1.8% to 2.9%.
"The weakness lacks the hurried or frantic pace of selling one might typically associate with a repricing of the magnitude seen thus far in 2022 – which is telling in an environment with relatively strained liquidity conditions. The flipside of the argument is that the lack of conviction has allowed the inertia created in the initial surge of 10-year yields above 2.78% to carry rates higher despite the lack of additional fundamental triggers," write the fixed income strategy team at BMO.
In terms of FX, the rise across the curve continues to underpin the incredible run in USD/JPY.