Treasurys inflation gauge exceeds 2% for 1st time since 2018

Traders see U.S. inflation averaging at least 2% per year over the coming decade, the first time expectations have climbed that high since 2018.

The 10-year breakeven rate -- a measure that draws on pricing for inflation-linked Treasurys -- rose as high as 2.01% Monday, a level last seen more than two years ago, data compiled by Bloomberg show.

The gauge has gained momentum as traders prepare for an uptick in the world economy in the wake of a deal on Brexit and the approval of additional virus-relief aid in the U.S. The rollout of vaccinations against the coronavirus is also fueling the move higher, as is speculation that Tuesday’s U.S. Senate runoff elections in Georgia could give Democrats control of Congress.