U.S. 10-Year Yield Rises Most in 16 Months on Tax Cut Extension

Treasuries plummeted, pushing the yield on the benchmark 10-year note up the most since August 2009, as traders speculated President Barack Obama’s agreement to extend tax cuts will accelerate economic growth.

The yield rose to a six-month high as reports this week showed consumer confidence climbed and a boost in exports shrank the trade deficit more than economists forecast. Central bank policy makers prepared to meet on Dec. 14 after Federal Reserve Chairman Ben S. Bernanke said purchases of government debt may be increased beyond the $600 billion announced last month.