Yields edge higher as Fed's Powell repeats case for gradual rate hikes

NEW YORK: US Treasury yields rose on Wednesday after Federal Reserve Chairman Jerome Powell said the Fed should continue with a gradual pace of interest rate increases given that the labor market does not seem to be overly tight.

"With the economy strong and risks to the outlook balanced, the case for continued gradual increases...remains strong," Powell said in prepared remarks before a central banking conference in Sintra, Portugal.

Before Powell's remarks, U.S. yields had been little changed, recovering from falls the previous session amid an escalating trade conflict between the United States and China.

U.S. benchmark 10-year yields rose to 2.9 percent  following Powell's comments, from Tuesday's 2.893 percent.

U.S. two-year yields were at 2.545 percent, unchanged from Tuesday. They were at 2.536 percent before Powell spoke.