The 10-year Treasury yield rose ahead of $67 billion in bond auctions by the Treasury department this week.
At around 5:10 a.m. ET, the benchmark 10-year note yield was up 4 basis points at 4.24%, while the 30-year Treasury bond yield climbed more than 5 basis points to 4.82%.
The Treasury department is expected to sell $42 billion of 10-year notes on Wednesday and $25 billion of 30-year bonds.
One basis point is equal to 0.01% and yields and prices move in opposite directions.
The rise in yields come after the prices portion of a key service sector survey was stronger than expected and as investors weighed developments tied to President Donald Trump’s tariff policy.
The ISM non-manufacturing purchasing managers’ index fell to 50.1 in July, below the 51.2 that had been seen by economists polled by Dow Jones ahead of the survey and below the 50.8 reading in June.
Notably, the prices index within the service survey showed a rise of 2.4 points to 69.9. New export orders fell 3.2 points to 47.9, imports tumbled 5.8 points to 45.9 and the employment index slipped further into a contraction, falling 0.8 point to 46.4.
Deutsche Bank’s analysts said the ISM data was “worrisome.” They added that it “raised renewed concerns that tariffs were pushing the US economy in a more stagflationary direction, complicating the Fed’s job in the process.”
While there’s no economic data of note expected Wednesday, traders will follow speeches by Federal Reserve officials, including Boston Fed President Susan Collins and San Francisco Fed President Mary Daly during the day.