10-year Treasury yield rises to highest level since 2007
10-year Treasury yield hits 19-year high as oil prices and Fed hike bets rise See why borrowing costs may climb and what higher inflation means for markets
The 10year U.S. Treasury yield climbed to its highest level in 19 years on Tuesday, reaching 5.041% as oil prices increased and markets anticipated another Federal Reserve rate hike. The move matters because the 10year yield influences borrowing costs for consumers and companies.
The 30year Treasury bond yield also rose to its highest level since 2007, while the 2year yield moved higher as traders priced in a strong chance of a quarterpoint Fed increase after inflation remained above the central bank’s 2% target.
Analysts said Treasury yields have become closely linked to oil prices as geopolitical tensions keep energy costs elevated. Higher oil prices can feed into inflation expectations, which in turn can put upward pressure on interest rates.