By Sunny Oh

10-year Treasury yield rests below 2.30%

Treasury yields rose as investors watch to see if the Federal Reserve will stay on track to hike rates amid tepid first quarter economic numbers.

The yield on the 10-year Treasury note gained 1.2 basis points to 2.247%. Bond prices move inversely to yields; one basis points equals one hundredth of a basis point. The yield for the policy-sensitive 2-year note added 0.4 basis point to 1.279%, and the yield for the 30-year bond rose 0.9 basis point to 2.906%.

Yields rose as President Donald Trump continued on his first international trip, at least temporarily taking attention away from investigations over administration ties to Russia. Analysts say the administration's pro-growth agenda could be derailed as the Russia probes continue. Derailed pro-growth policies could lower inflation expectations, which can be bullish for bonds.

The diminished geopolitical concerns fed into the European sovereign debt market. 10-year German government paper, or bunds, rose 2.9 basis points to 0.396%, while the 10-year French government bond climbed 4.1 basis points to 0.850%.

Traders will eye a packed calendar for senior Fed officials as the probability of a June rate increase heads close to 100%, according to the Chicago Mercantile Exchange's FedWatch tool (http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html). Members of the Fed have cleared the path to tighten monetary policy by down-playing the tepid first-quarter data in May's policy statement (http://www.marketwatch.com/story/fed-to-signal-rate-hike-plan-in-place-despite-soft-economic-data-2017-04-27).

But last week, St. Louis Fed President James Bullard, though not a non-voting member in 2017, called for a slower pace for monetary tightening (http://www.marketwatch.com/story/feds-bullard-questions-need-for-june-rate-hike-2017-05-19). He labeled the current timetable of two further rate increases as "aggressive" in light of recent weakness in economic data.

Philadelphia Fed President Patrick Harker, a voting member of the central bank, will give a commencement speech to the Jefferson College of Health Professions at 10 a.m. Eastern. Minneapolis Fed President Neel Kashkari, also a voting member, is scheduled to speak at 10:30 a.m.

Fed Gov. Lael Brainard will give a speech on opportunity and inclusion in the U.S. economy at 7:30 p.m. Eastern. Chicago Fed President Charles Evans, a voting member, will address a private symposium in Shanghai at 9:10 p.m. Eastern.

(END) Dow Jones Newswires

May 22, 2017 09:19 ET (13:19 GMT)