The 10-year US Treasury yield rose sharply on Monday, resuming gains after a temporary pause on Friday and hitting a fresh 19-year high amid strong expectations that the Federal Reserve will continue normalizing monetary policy in the United States. Oil prices jumped more than 4% at the start of the week, fueling concerns over increasing inflationary pressures on Federal Reserve policymakers and strengthening expectations for a US interest rate hike in October. US Treasury yields The 10-year US Treasury yield rose 1.3% to 5.234%, its highest level since July 2007, from Friday’s closing level of 5.167%. The yield recorded an intraday low of 5.192%. The yield fell 0.8% on Friday, its first decline in four sessions, amid correction and profit-taking. Global oil prices Oil prices climbed more than 4%, moving close to a two-week high amid renewed concerns over the security of oil supplies from the Middle East as political tensions between the United States and Iran escalated and Houthi attacks on Saudi oil facilities continued. US interest rates • According to the CME FedWatch Tool, markets currently price a 30% probability that the Federal Reserve will leave interest rates unchanged at its October meeting and a 70% probability of a 25-basis-point rate hike. • Markets currently price a 5% probability that the Federal Reserve will leave interest rates unchanged at its December meeting and a 95% probability of a 25-basis-point rate hike. • Investors are closely monitoring further US economic data and comments from Federal Reserve officials to reassess those expectations.