Analysts said a report late Tuesday that the ECB may delay quantitative easing and tie it to upcoming economic data may have triggered the latest sell-off in European debt. "There was an expectation that the ECB would be aggressive with easing," said Tom Simons, economist at Jefferies in New York. "If they're not, that kind of changes the calculus a little bit. There's nervousness on that front, so there's a lot of paring back of positions."
A Reuters poll showed nearly 70 economists were expecting the ECB to cut its deposit rate at the meeting, predicting a 10 basis point reduction to -0.5%.
Yields also found support from a further easing in US-China trade tensions
after China announced its first batch of tariff exemptions for 16 types of US products, days ahead of a planned meeting between trade negotiators.
Trump described China's move as "good gesture".
"The sentiment that we're slipping into recession is quickly slipping," said Stan Shipley, fixed income strategist, at Evercore ISI in New York. He added that the Federal Reserve will likely cut interest rates next month, but after that, "it gets more squishy."
Trump on Wednesday called on the Fed to lower interest rates into negative territory, a move reluctantly used by some major central banks to battle weak economic growth as it punishes savers and banks' earnings in the process.
Evercore's Shipley said this is not something an independent Fed would do. "If Trump really thinks about it, zero or negative interest rates would be consistent with a recession and that's the last thing he wants."
In afternoon trading, US 10-year note yields rose to 1.74% from 1.702% late on Tuesday. Early in the session, 10-year yields hit a five-week high of 1.752%.
Yields on 30-year bonds were also higher at 2.217% from 2.181% on Tuesday, moving further away from record lows of 1.905% touched in late August. US 30-year yields also hit a four-week peak of 2.233% earlier in the global session.
US two-year yields rose as well to 1.676% from Tuesday's 1.664%, hitting a five-week high of 1.686%.
Also on Wednesday, the Treasury sold $24 billion in re-opened US 10-year notes, but the auction posted mixed results. The high yield of 1.739% was higher than the expected yield at the bid deadline. But the bid-to-cover ratio was better than average at 2.46.