A speech by Richmond Federal Reserve president Jeffrey Lacker on Tuesday, in which he said there will only be a cut in interest rates if the current market volatility has a visible effect on the economy sent US Treasury bond prices lower on Wednesday.
With the possibility of a rate cut fading and equities markets seeing gains, yields on two-year Treasury bonds were up from 4.04 percent on Tuesday to 4.17 percent Wednesday, the biggest one-day gain in yields this year.
Five-year issues yielded 4.36 percent, up from 4.26 percent on Tuesday, while ten-year yields were up to 4.65 percent.
Thirty-year paper was yielding 4.36 percent, up from 4.26 percent on Tuesday.