Treasury traders are betting the rapid spread of the omicron variant will increase inflationary pressures in the U.S. economy, rather than weaken them.
U.S. 10-year break-even rates -- which are market estimates for the average rate of inflation over the next decade -- climbed to as high as 2.66% on Tuesday, the most since November, and up from as low as 2.36% on Dec. 14. The extra yield on Treasury 10-year notes over two-year securities has also jumped this week, indicating the bias may be switching back to a steeper yield curve.
