NEW YORK: The US Treasury market rallied on Tuesday with yields hitting multi-week lows on remarks from Federal Reserve Chair Janet Yellen who said the US central bank should proceed "cautiously" with interest rate hikes.
Yellen's comments came following views from a handful on top Fed officials in recent days who said the US economy is strong enough to warrant further rate increases.
However, Yellen cited on Tuesday her concerns about global developments including volatility in the oil market and China's slowing growth and how soon domestic inflation would reach the Fed's 2 percent goal as key factors for the Fed to take a gradual approach on normalizing monetary policy.
Benchmark 10-year Treasury notes were last up 14/32 to yield 1.833 percent, which was down 5 basis points from late on Monday.
The 10-year yield touched a three-week low of 1.819 percent shortly after the release of Yellen's prepared remarks before the Economic Club of New York.