CHICAGO: US Treasury yields eased on Tuesday after consumer prices data indicated that while underlying inflation picked up in March, it was not wildly spiking as feared.

A move higher earlier on Tuesday that lifted the benchmark 10-year yield to 1.703% also abated after US federal health agencies recommended pausing the use of Johnson & Johnson's COVID-19 vaccine due to concerns related to blood clots.

The 10-year yield was last down 2.1 basis points at 1.6552%, holding below a 14-month high of 1.776% reached on March 30.

With the economy getting a boost from the coronavirus vaccine rollout and massive fiscal stimulus, the consumer price index jumped 0.6% last month, the largest gain since August 2012, after rising 0.4% in February, the US Labor Department said on Tuesday. Core CPI, excluding food and energy prices, rose 0.3%, after edging up 0.1% in February and was up 1.6% on a year-on-year basis.

Zachary Griffiths, macro strategist at Wells Fargo in Charlotte, said the data showed that "inflation isn't running away anytime soon and it's not going to cause the (US Federal Reserve) to reassess its approach to monetary policy in the near future."

"We've had yields run up a ton on expectations that inflation is going to be going to the moon ... but (the data) doesn't show any signs of getting completely out of control, at least not yet," he said.

Later on Tuesday, the US Treasury Department will auction $24 billion of 30-year bonds after Monday's three- and 10-year note auctions performed relatively smoothly.

Griffiths said while he expects the bond auction to go well, the focus will be on follow-through trading "to get a feel for how the market is really taking down the auction."

The 30-year yield was last down 1.2 basis points at 2.3356%.

The two-year Treasury yield, which typically moves in step with interest rate expectations, was last less than a basis point lower at 0.1629%.

A closely watched part of the yield curve that measures the gap between yields on two- and 10-year Treasury notes was about a basis point flatter at 148.85 basis points.