longdated us treasury yields inched higher thursday morning and the 2year added slightly to its rise a day after a federal reserve policy update when the shortdated debt registered the biggest oneday jump in three months investors continue to watch developments with china’s evergrande with reports suggesting that the chinese government would only come to bailout the heavily leveraged property developer at the last minute as its debts come due what treasury yields are doing   the 10year treasury note yields tmubmusd10y 1333 compared with 1332 on wednesday at 3 pm eastern time   the 30year treasury bond rate tmubmusd30y was at 1836 versus 1848 up 12 basis points   the 2year treasury note tmubmusd02y was yielding 0247 compared with 0240 on wednesday which marked the largest daily yield climbing since june 23 on wednesday the widely watched spread between 2 and 10year rates flattened—as did the gap between five and 30year yields occurring after policy makers had penciled in a soonerthanexpected rate increase for 2022 and said a tapering of monthly bond purchases “may soon be warranted” the federal reserve meeting has set the stage for an announcement of tapering at the next central bank meeting in november which could see reductions of the monthly purchases of 80 billion in treasurys and 40 billion in mortgagebacked securities kick off by december especially if the labor market maintains its trajectory of improvement from the covid19 pandemic yields are seen eventually rising against this backdrop but some analysts attributed the reaction to the fed decision to a dovish interpretation considering fewerthanexpected policy makers called for a first policy interest rate increase next year from the current 0 to 025 range others note that even with tapering of bond purchases the fed is still buying sizable amounts of assets with its balance sheet at around 85 trillion as of sept 13 an update on the central bank’s balance sheet is due at 430 pm thursday meanwhile the bank of england kept its monetary policy unchanged but downgraded projections for the third quarter economic growth the boe unanimously decided to keep interest rates at 01 and its two newest members were on the side of maintaining its bond purchase program in a 72 vote that news came as the central bank of the republic of turkey made a surprise decision to cut interest rates lowering them to 18 from 19 looking ahead investors will be watching for updates on us economic reports including a report on weekly jobless claims for the week ended sept 18 with 309000 claims forecast by economists polled by econoday the chicago fed national activity index also is due at the same time the ihs markit reading of us service and manufacturing sectors are due at 945 am et investors will also closely watch an auction of 14 billion 10year treasury inflationprotected securities or tips at 1 pm progress in congress toward raising the us federal debt limit is being closely watched by fixedincome investors on wednesday six former us treasury secretaries from democratic and republican administrations warned that failing to raise the debt limit on time and allowing the us to default could cause serious harm to the economy and national security what analysts are saying   “tips are a great us treasury allocation when the fed is debating what to do about inflation but less so when the fed signals initial steps toward a policy turn tighter—even if tightening is 12 months away today’s auction will provide a fresh look at the balance between reflation fears and the overbought conditions that have ruled the tips market all year” wrote jim vogel executive vp at fhn financial   “even with a taper we are looking at more buying of 600700 billion think about that in historical context of fed qe” writes gregory faranello executive director of amerivet securities and head of us rates trading and strategy