US bond yields rise on inflation data

US bond yields rose on Wednesday, following the issuance of inflation data that showed the consumer price index accelerated more than expected in January.

The two-year bond yields, the most sensitive to monetary policy changes, rose 7.1 basis points to 4.361% at 05:21 PM Makkah time.

Likewise, the 10-year yields rose 10.6 bps to 4.643%, and 30-year yields added 9.8 bps to 4.842%.

Official data released on Wednesday by the US Bureau of Labor Statistics showed that annual consumer price index rose to 3% in January, compared to expectations of stabilizing at 2.9%.

The core CPI, which excludes volatile food and energy prices, rose 0.4% month-on-month and 3.3% year-on-year, compared to expectations of a rise by 0.3% and 3.2%, respectively.

The better-than-expected inflation data may drive the Fed to move forward with plans to lower the pace of monetary easing to slow inflation to its 2% target.