The 10-year Treasury note yield jumped Tuesday, adding to its gains from the previous session, as traders reassessed the possibility of the Federal Reserve cutting rates in June.

The benchmark rate was up 2.6 basis points at 4.355%. It previously reached its highest level since Nov. 28, briefly breaking above 4.4%. The 2-year Treasury note yield was down 2.5 basis points at 4.693%.

Yields and prices move in opposite directions, and one basis point equals 0.01%.

The moves come after manufacturing in the U.S. expanded for the first time since Sept. 2022, according to data released Monday by the Institute for Supply Management. The ISM manufacturing index rose to 50.3, up from 47.8 in February and significantly better than the 48.1 Dow Jones consensus estimate. The index measures the percentage of companies reporting expansion against contraction, so anything over 50 indicates growth.

Odds for a June rate cut based on fed futures trading are now down to roughly 63%, off from about 70% a week ago, as investors remain cautious about the direction of rate cuts moving forward, according to the CME FedWatch Tool. Markets interpreted the unexpected return of U.S. manufacturing growth “as reducing the chances of meaningful Fed rate cuts,” Dutch bank ING said in a research note.

Last month, the U.S. central bank left interest rates unchanged for the fifth consecutive time, in line with expectations, keeping its benchmark overnight borrowing rate in a range of 5.25%-5.5%. The Fed also said at the time that it still expects three quarter-percentage point cuts by the end of the year.

“The Fed is playing things cool. And the data has cooperated with that notion,” Gregory Faranello, head of U.S. rates strategy at AmeriVet Securities, wrote in a note Monday. “For now, market pricing is embracing three cuts with a lean toward a June start date. But it’s tight depending on how the data unfolds.”