The US 2 year Treasury yield jumped as much as 17.4 basis points, on pace for its largest single day increase since April 2025, after October’s hotter than expected consumer price report boosted bets on Federal Reserve rate hikes. The 10 year Treasury yield climbed 11 basis points to 4.99%, the 30 year yield added 6.3 basis points, and the 2 year yield traded around 4.71% as traders priced in at least two Fed rate increases by mid 2027.

Underlying inflation measures also accelerated, with supercore CPI, which tracks core services excluding housing, rising 0.4% on the month and surging to a 5.5% three month annualized pace, the fastest since April 2024. Three month annualized core CPI climbed to 3.75%, the highest reading since January 2025, as the weighted share of CPI components rising faster than 2% annualized reached 76.3%, the most since August 2022.

The bond selloff followed Bureau of Labor Statistics data showing October headline CPI rose 0.4% and core CPI gained 0.3% for a third straight month, both 0.1 percentage point above consensus estimates and beating 69 of 70 Wall Street forecasts. The 0.3% core increase matched the threshold Fed Governor Christopher Waller laid out earlier Tuesday for considering a 50 basis point rate hike at the Dec 8 to Dec 9 policy meeting, pushing CME FedWatch odds of a half point move to 15% and wiping roughly $600 billion from US stocks at the open.