U.S. Treasury Yields Surge Above 5%, Raising Concern Across Markets
publishers 16articles 28first reported 23 Sep, 17:07 UTCdeveloping since 23 Sep · 9 editions
U.S. Treasury yields climbed to multiyear highs this week, increasing borrowing costs and prompting concern about the speed of the bond-market selloff. The 10-year yield reached 5.21% on Friday, its highest level since 2007, while the 30-year yield hit its highest level since 2004.
The rise followed the Federal Reserve’s first interest-rate increase since 2023. Fortune reported that markets were pricing in roughly a 70% chance of another increase in October. Demand at Wednesday’s auction of five-year Treasury notes was the weakest since 2018.
Higher Treasury yields feed into rates on mortgages and other loans. Fortune said the average 30-year mortgage rate rose to 7.45%. Rising government-bond yields can also pressure stocks by giving investors a higher return on comparatively low-risk assets.
Economists and investors disagree over what is driving the move. One explanation is that strong economic growth is leading markets to expect rates to remain elevated. Another is that investors are demanding greater compensation to hold long-term U.S. debt because of inflation, deficits or other risks.
The pace of the increase has added to unease. The 10-year yield was below 4.8% two weeks earlier before exceeding 5.17% on Thursday, CNBC reported. John Roque of 22V Research said similarly rapid increases have historically preceded financial-market disruptions. Traders cited private credit, debt-funded artificial-intelligence data centers and regional banks as areas to watch, though no specific failure has been identified.
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Written from 8 articles, 2 with the publisher's own text; 8 independent newsrooms once syndicated copies count as one; this version written 24 h after the record first saw the story; the editor kept it as written.
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