The ongoing bond market adjustment to the threat of tighter monetary policy accelerated last week, as yields jumped at the start of trading in the new year. The expectation of higher rates was reinforced during the week, first by the minutes of the Fed’s December meeting, followed by the solid December jobs report. The yield on the U.S. ten-year note surged 25 basis points higher on the week to 1.76 percent, its highest in two years, dating back to just prior to the onset of the pandemic. The bond market adjustment began in September when the Fed first hinted at tapering. Back then the ten-year note was yielding 1.30 percent. The more Fed sensitive two-year note has climbed from 0.20 to 0.86 percent since September, after rising 14 basis points last week. For the week, the Bloomberg Barclays U.S. Aggregate Bond index fell 1.5 percent.