The benchmark 10-year Treasury yield climbed to its highest level since 2007 on Tuesday as a sell-off in U.S. government debt deepened ahead of the Federal Reserve's interest-rate decision.

The 10-year yield jumped more than 6 basis points to 5.025% as of 1.10 a.m. ET. On Monday, the 10-year yield had briefly crossed 5%, before sliding a little.

One basis point equals 0.01 percentage point, and yields and prices move in opposite directions.

The move comes ahead of the Federal Reserve's two-day policy meeting beginning Tuesday, with markets pricing in higher chances of a quarter-point rate hike after August inflation remained well above the central bank's 2% target.

Traders are pricing in a more than 92% chance that the Fed will raise rates by 25 basis points in its latest meeting, according to the CME FedWatch tool.

"U.S. 10-year treasuries are highly sensitive to inflation expectations, and with inflation gauges still above the Fed's target of 2%, we believe this tight correlation will likely persist for a while," said Jonathan Liang, Standard Chartered's CIO of fixed income and FX.