NEW YORK/LONDON (Reuters) – World stocks hovered near record highs and U.S. bond yields fell on Wednesday as some of U.S. President Joe Biden’s stimulus efforts appeared to be on the rocks, boosting the appeal of technology stocks as future inflation pressures ease. A little noticed ruling by the Senate parliamentarian in late May said Democrats can only use “reconciliation” once in a fiscal year to circumvent legislation that requires 60 votes. Democratic fiscal packages in Congress are rapidly shrinking, leading to a net outcome that inflationary pressures are set to recede, said Sebastien Galy, senior macro strategist at Nordea Asset Management. The yield on benchmark 10-year U.S. Treasury notes fell 3.2 basis points to 1.4958%, down from 1.528% late on Tuesday. Yields plunged as traders in part were forced to unwind short positions in Treasuries, said Joe LaVorgna, chief economist of the Americas at Natixis. “More importantly, the economy is at its peak growth and a lot of what the (Biden) administration wants to do in terms of fiscal stimulus may not be met because of the parliamentarian ruling,” LaVorgna said. Attention remained focused on Thursday’s release of U.S. consumer price data and a European Central Bank meeting that could indicate how soon policymakers will begin to withdraw support for Europe’s economy as the COVID-19 crisis ebbs. Germany’s 10-year Bund yield, which is closely correlated with U.S. Treasuries, extended Tuesday’s decline to -0.253%, the lowest since late April, as investors continued to price in a dovish outcome to the ECB policy meeting on Thursday. “As the recovery in the (U.S.) job market is contained, any discussion at the Fed on tapering is unlikely to gain momentum, even if it starts soon,” said Naokazu Koshimizu, senior rates strategist at Nomura Securities. U.S. payrolls data last Friday showed hiring was slower than economists had expected, despite increasing signs of a labor market shortage. Many analysts say more evidence of strong jobs growth is required for the Federal Reserve, which has repeatedly said a jump in inflation this quarter would be transient, to step up taper talk. Thursday’s U.S. consumer price data is expected to show the overall annual inflation rate spiking to 4.7% and core inflation rising to 3.4%, a pick-up that concerns investors who don’t entirely buy the Fed’s transitory narrative. The CPI data is unlikely to settle questions about the future path of inflation, said James Athey, investment director at Aberdeen Standard Investments. “I therefore see potential for a higher print to push real yields and shorter-dated yields higher, thus flattening the curve and boosting the dollar,” Athey said. “This might not be a great environment for risky assets. Nick Note: My bet is on higher stock market valuations. Inflation has nothing to do with the stock market. In fact during the times of the greatest inflation we have seen the biggest rallies in stocks