US Treasury yields surged then pulled back after the CPI release, as the market assesses inflation data and remarks from Federal Reserve officials.

Overnight during U.S. trading hours, U.S. Treasury prices rallied sharply, reversing the sell-off sparked by the latest higher inflation data, with yields on most Treasury maturities turning lower. This highlights the market’s conflicting bets on two scenarios: one is accelerating consumer price data, the other is Federal Reserve officials signaling no urgency to raise interest rates further.

Official U.S. data showed that September’s year-over-year Consumer Price Index (CPI) rose 3.7%, exceedi

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