Most yields slip after Yellen says tax cuts should be repealed

Rates at the long end have been rising on expectations of rising inflation.

"Generally people expect inflation to be on the upswing here. You see that in inflation expectations, which are trending higher," said Stan Shipley, macro research analyst at Evercore ISI in New York.

Crude oil, many industrial commodity prices, both tradable and non-tradable like plastics, are on the rise, Shipley said. When spending plans by the incoming Biden administration are
added, higher rates are likely this year, he said.

"There will be a push by the Biden administration to try to get wage gains to accelerate too," he said.

Benchmark 10-year yields traded lower at 1.090%, falling from earlier gains. The benchmark rate closed at 1.085% on Friday before the long U.S. weekend, with markets closed for Martin Luther King Jr. Day on Monday.

The yield on the 20-year bond inched up about one basis point one day before the Treasury is due to sell $24 billion in the 20-year on Wednesday, followed by $15 billion in 10-year TIPS on Thursday.

Rates two weeks ago jumped above 1% for the first time since March and have trended higher since.

Yellen told the Senate committee that extended unemployment and food aid will provide the "biggest bang for the buck" in stimulus spending. The core focus will be the needs of workers
in cities and rural areas, she said.

Yields jumped last week ahead of Biden's announcement of the stimulus blueprint.

Federal Reserve officials have talked down market speculation that the U.S. central bank will pull back, or taper, its bond-buying program.

The yield curve between two-year and 10-year notes rose slightly to 96.40 basis points.