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SINGAPORE/WASHINGTON (Reuters) – U.S. Treasury yields hit one-year highs on Wednesday, lending support to the dollar but pressuring lofty valuations for stocks, as investors reckoned that a stimulus-fuelled global recovery will eventually bring rising inflation. Benchmark ten-year U.S. Treasury yields rose as far as 1.3330% in Asia, the highest since February 2020, although they later eased back to 1.2989%. [US/] The gap over two-year yields also opened to its widest in nearly three years, as traders figure that short-term monetary policy will stay accommodative, even as the world bounces back from the pandemic. The prospect of better risk-free returns weighed on equities and MSCI’s broadest index of Asia-Pacific shares outside Japan was stalled just shy of Tuesday’s record peak. Japan’s Nikkei fell 0.7% and S&P 500 futures slipped 0.3% after the index posted a small fall overnight. "You’re basically taking away a deflation worry," said Rob Carnell, chief economist in Asia at ING. "It’s a general sense that things are moving back to normal, and probably the single biggest driver of that is the fall in COVID numbers in U.S., it’s the re-opening that really delivers you the growth," he said. New COVID-19 cases in the United States fell […]
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