March 30 (Reuters) - The yield on the benchmark U.S. 10-year Treasury note is closing in on 2%, last reached in August 2019, in a move that has spooked some sectors on Wall Street even as central bankers have soothed investors’ jitters about near-term inflation. The 10-year yield spiked to 1.776% on Tuesday, its highest since last January, before the coronavirus sent the world economy into a tailspin, weighing on technology stocks that rely on cheap funding for growth. Forecasts for the benchmark rate have been trending higher, propelled by stronger economic data as vaccine rollouts open a path to normalcy after a year of lockdowns and other curbs. The 10-year rate, which fell to the lowest on record at 0.318% in March 2020, has climbed more than 80 basis points so far this year. It is now widely expected to reach or top 2% by year end. BNP Paribas’ latest forecast pointed to a much quicker surge with the yield hitting 2% in the second quarter amid “a supercharged recovery” that would push it to 2.10% in the third quarter and 2.20% in the fourth. But the move to 2% may not necessarily be that swift. “I don’t think we’re in the middle of a big sustained move to much higher yields,” said Tom Simons, a money market economist at Jefferies in New York. “I think it’s more of a grind until something changes.” He said poor market liquidity this week due to quarter- and month-end rebalancing and the upcoming expiration of a temporary bank leverage rule exemption was putting upward pressure on yields. “The market overall is relatively stable, but this week it is dealing with those liquidity challenges related to the end of the month,” he said. The slide in the price of Treasuries, which investors see as safe havens is no real surprise given the S&P 500’s run to record highs in recent days. Still, yields are looking more attractive, which help support bonds until inflation shows its hand. Michael Purves, chief executive of Tallbacken Capital Advisors in New York, said the rise in yields since last summer has been directly linked to market expectations of interest rate hikes by the Federal Reserve to stop inflation taking off. Policy makers have taken every opportunity to dampen those fears, saying any big inflation uptick was likely to be shortlived. “Today, the short-run inflation story has been fully priced in and now longer run inflation (beyond five years) has to do the heavy lifting for the bears,” he wrote in a note. The 10-year yield was at 1.7242% late Tuesday.