NEW YORK: US Treasury yields rose and the yield curve steepened on Wednesday as hopes of a COVID-19 vaccine boosted risk appetite and reduced demand for safe-haven bonds.

Moderna Inc's experimental vaccine for COVID-19 showed it was safe and provoked immune responses in all 45 healthy volunteers in an ongoing early-stage study, US researchers reported on Tuesday.

"The market is trading fairly 'risk on' on vaccine hopes," said Gennadiy Goldberg, an interest rate strategist at TD Securities in New York. "It's largely COVID news driving the price action recently."

Investors are wary about new economic damage as a sharp rise in COVID infections in many US states leads to new shutdowns aimed at stemming the spread of the virus.

Benchmark 10-year notes rose three basis points to 0.648%. They have held in a tight range from 0.569% to 0.784% since mid-June.

The yield curve between two-year and 10-year notes steepened two basis points to 48 basis points.

Data on Wednesday showed that US import prices increased more than expected in June amid a surge in the cost of fuel, but the overall trend remained weak, suggesting inflation could stay tame despite a jump in consumer prices last month.

Industrial output also rose 5.4% in June, while a New York manufacturing index jumped more than expected in July.

The next major economic focuses are jobless claims and retail sales on Thursday.