0536 GMT - Front-end U.S. Treasury yields are pricing the risk of a renewed Federal Reserve hiking cycle, analysts at Variant Perception say in a note. However, the majority of historic energy shocks lead to lower yields over time as the supply shock hurts growth eventually, they say. The main exception is 2022, when the Fed was just starting to normalize policy rates from the zero bound, they say. "Today, U.S. two-year yields are trading more like the 2022 pattern than a typical energy shock," the analysts say. However, they remain skeptical of a 2022 repeat and think it is more likely that yields ultimately fall. (emese.bartha@wsj.com)

(END) Dow Jones Newswires

June 02, 2026 01:36 ET (05:36 GMT)

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