Treasury yields rise after Fed raises rates by half a point, indicates more hikes

U.S. Treasury yields rose on Wednesday after the Federal Reserve delivered a widely expected 50 basis point rate hike and indicated that it will continue raising rates to tame inflation.

While a smaller hike from the previous four increases, the Fed indicated that it will keep rates higher through next year, and hold off on cuts until 2024. The central bank also said it expects to raise its "terminal rate" to 5.1% before the hiking cycle concludes.

The yield on the benchmark 10-year Treasury note rose more than 3 basis points to 3.538%, after dipping below the 3.5% level earlier in the day. The 2-year Treasury yield gained 3 basis points to 4.258%.

Yields and prices have an inverted relationship. One basis point equals 0.01%.

Investors are looking ahead to Fed Chairman Jerome Powell's press conference, expected to offer more clues on the central bank's rate-hiking path. Investors are hoping to receive guidance on monetary policy and the central bank's assessment of inflation and the state of the wider U.S. economy.

Wednesday's moves come after November consumer price index data released indicated that inflationary pressures are easing. Prices rose by 0.1% in November from October and by 7.1% on a yearly basis. Both figures came in lower than economists surveyed by Dow Jones had expected.