The 10-year yield rises to 1.697% from 1.623% Tuesday as higher-than-expected April inflation rattles investors. The Labor Department says consumer prices increased 4.2% over a year earlier, while core inflation was 3%. The New York Fed’s Underlying Inflation Gauge for April is now estimated at 2.7%, a 0.5 percentage point increase from the previous month. Even though Fed officials insist inflation would be allowed to run high for a while before any monetary tightening, investors are getting nervous. The inflation reading “will likely fuel higher yields in the intermediate future,” says Spartan’s Peter Cardillo.