Yields on government debt have risen as Congress weighs Trump’s budget plan. Meanwhile, interest on the debt is approaching $1 trillion a year – on par with proposed Defense spending.

The bond market has a sleepy reputation, but it can pack a punch when alarmed. And worries are now growing about tax cuts pushed by Washington and how they'll inflate the U.S. government's debt.

US Treasury yield is trading in a range that implies some investors are pricing in stagflation, according to one strategist.