Treasury Yields Surge on Hot Inflation Data, Undermining Fed's Rate Hike Pause

Long-dated Treasury yields headed toward 5% again after data showed hotter-than-expected September inflation, taking steam out of equities.

Rise in yields broke a two-day rally and cast doubt on the Fed's view that recent yield increases could tighten conditions without more hikes.

Analysts say Thursday's bond selloff undercuts the Fed's arguments for avoiding another rate hike.

Stock indexes finished lower and the dollar index rose as higher yields signaled tighter financial conditions.

Fed funds futures now price in a 31% chance of a December rate hike, up from recent days, as markets see more hikes needed.