Treasury yields fall despite rate hike concerns hitting tech stocks

U.S. Treasury yields fell on Tuesday, despite fears of higher interest rates dealing a blow to tech stocks globally, while investors await key inflation data due to be released Thursday. 

The yield on the 10-year U.S. Treasury note — the key benchmark for U.S. government borrowing — fell over 2 basis points to 4.481%.

The 2-year Treasury note yield, which more closely tracks short-term Federal Reserve interest rate policy, was over 4 basis points lower at 4.190%. The longer-dated 30-year Treasury bond yield fell about 1 basis point to 4.937%.

One basis point equals 0.01%, and yields and prices move in opposite directions.

On Monday, the 2-year yield touched its highest level since February 2025 before paring losses slightly.

The moves came as fears of rate hikes by Kevin Warsh's Fed spooked investors and sparked a sell-off in global tech stocks. 

In the U.K., bond yields fell slightly even after Prime Minister Keir Starmer announced he would resign, opening the door for the country's seventh leader in 10 years. 

Though Andy Burnham, former mayor of Greater Manchester and heavy favorite to become Britain's next premier, is placed as more left-leaning than his predecessor, his potential arrival in 10 Downing Street has been largely priced in by bond markets.

A key test for Treasuries comes later this week, when May's reading on the personal consumption expenditures price index, the Fed's preferred inflation gauge, is released Thursday.

Excluding volatile food and energy prices, core PCE is expected to increase from April, according to economists polled by FactSet.

— CNBC's Sean Conlon also contributed to this report.