U.S. 10-Year Treasury Yield Hits 24-Year High in Global Bond Sell-Off

The yield on the 10-year U.S. Treasury note climbed above 5.34% on Thursday, reaching its highest level since April 2002 as a global government bond sell-off intensified. It later retreated to about 5.25% as buyers returned to the Treasury market.

The 30-year Treasury yield also reached a 24-year high before pulling back to 5.61%, CNBC reported. Bond yields move inversely to prices. Higher 10-year yields can feed into increased borrowing costs for mortgages, auto loans and other forms of consumer credit.

The latest rise followed a September U.S. manufacturing survey that showed mounting price pressures. The Institute for Supply Management’s prices index rose 6.8 points to 77.9, while its measure of order backlogs increased 4.6 points to 56.4.

Government borrowing costs also rose in other major markets. Japan’s 10-year yield reached 3.126%, its highest since the mid-1990s, while Germany’s benchmark yield briefly exceeded 3.6%, a level last seen in 2008. French, Italian and British yields also advanced.

Persistent inflation, large fiscal deficits and rising oil prices contributed to pressure on bonds. Brent crude moved back above $100 a barrel amid disruptions to Middle Eastern exports, reinforcing concerns that energy costs could keep inflation elevated and central banks’ interest rates higher.