TOKYO: US Treasuries continued to skid in Asian trade on Wednesday, with 10- and 30-year yields extending their recent rise on expectations that the Federal Reserve will begin to mull paring its monetary stimulus as the US economy improves.
US home prices accelerated by the most in nearly seven years in March, data on Tuesday showed, while consumer confidence surged.
The US central bank now buys about $85 billion in assets every month, but investors fear it will begin to reduce that amount as evidence mounts that the economic recovery is gaining traction.
"We need to see the next US monthly employment figures to confirm the extent of economic improvement, but the market is pricing in expectations that the Fed will begin to taper its quantitative easing," said Hiroki Shimazu, senior market economist at SMBC Nikko Securities.
The yield on the 10-year notes rose as high as 2.235 percent on Wednesday, its highest since April 2012, from 2.172 in late US trade and from as low as 1.61 percent earlier this month.
The yield on 30-year notes rose to 3.350 percent from 3.331 percent in Tuesday's US trade.
Investors will be watching the Treasury department's sales this week, to gauge demand. It will offer $35 billion in five-year notes on Wednesday and then $29 billion seven-year notes on Thursday.
A sale of two-year notes on Tuesday met lacklustre demand, with a higher-than-expected yield and fewer bids than average.
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