Short-dated Treasury yields leapt to the highest in almost 22 months in Tokyo on Tuesday amid bets the US recovery will stay on track despite the risks from Omicron, leading to a Federal Reserve rate hike as soon as March.

The two-year yield, which is very sensitive to interest rate expectations, hit 0.758% for the first time since early March 2020, a more than 5 basis point jump from Monday's close.

Ten-year yields, by contrast, were little changed at 1.4790%, consolidating in the middle of the range of the last several days.

Short-dated yields have been on the rise for the past week, buoyed by a hawkish tilt at the Fed that has policy makers signaling three quarter-point rate increases for 2022.

Money markets put better than 50-50 odds on a hike at the Fed's March meeting, and consider one by May a certainty.

A report overnight showing robust US holiday retail sales increased optimism that the US economy will stay strong despite the threat from the Omicron coronavirus variant, which has caused thousands of flight disruptions in the United States in recent days.

The Treasury sold new two-year notes to soft demand on Monday. It sells five-year notes on Tuesday and seven-year notes on Wednesday, when it also offers two-year floating-rate notes.