Nov 12 (Reuters) - Short-dated U.S. Treasury yields

jumped to a fresh 3-1/2-month high on Tuesday as investors

priced in the possibility of higher rates from U.S.

President-elect Donald Trump's proposed policies on taxes and

trade tariffs.

The bond market had been closed for a holiday the day

before.

Analysts expect Trump's administration to bring more

government borrowing due to higher fiscal deficits, lower taxes

and higher tariffs.

The U.S. 2-year yield, which is very sensitive to

expectations for U.S. interest rates, rose to 4.33%, its highest

since July 31 and was last up 7 basis points (bps) to 4.32%.

The benchmark U.S. 10-year yield rose 5 bps to

4.35%.