Interest rate cut timeline assessed by traders as Treasury yields rise.

On Monday, U.S. Treasury bond yields increased, aligning with remarks from Minneapolis Federal Reserve President Neel Kashkari that the central bank might not reduce rates until December.

The yield was trading nearly 3 basis points higher at 4.238% at 4:17 a.m. ET. The note yield was up around 3 basis points at 4.717%.

Prices and yields move in opposite directions. A basis point is equivalent to 0.01%.

Kashkari stated in an interview with CBS News on Sunday that it is a "reasonable prediction" that the Fed will not cut interest rates until December. He added that more evidence is required to convince the Fed that inflation will decrease to 2%.

"According to Kashkari, the decision will depend on the data. Currently, the economy is in a good position to wait for more inflation, economic, and labor market data before making any decisions. However, if the median indicates a single cut, it is likely to occur at the end of the year."

The producer price index for May came in lower than expected, boosting hopes of a Fed rate cut and sending Treasury yields lower. However, the central bank opted to hold rates steady at 5.25% to 5.50% and indicated that only one rate cut would occur this year.

This week, we will receive key data such as May retail sales figures, which will be released on Tuesday. Additionally, home sales and housing starts data will become available later in the week.

The U.S. markets are closed on Wednesday for the Juneteenth holiday, making it a short week.