US Treasury Yields Hit 24-Year High; 10-Year Rises to 5.34%
Summary
- US Treasury yields surged, with the 10-year rising to 5.34% and the 30-year to 5.70%, reaching their highest levels in 24 years.
- Solid economic growth, increased artificial intelligence-related investment and persistent inflation pressures fueled a bond selloff and pushed long-term yields higher.
- Markets are pricing in about a 25% chance of a Federal Reserve benchmark interest rate hike in October, while fully pricing in one 25-basis-point increase by December.
Forecast Trend Report by Period
US Treasury yields surged to their highest level in 24 years, with the 10-year yield rising to 5.34% and the 30-year yield climbing to 5.70%. Both reached their highest levels since 2002.
Walter Bloomberg reported on Oct. 5 that long-term Treasury yields rose in the U.S. bond market as solid economic growth, increased investment related to artificial intelligence and persistent inflation pressures fueled a selloff in government debt.
The prices-paid index in the Institute for Supply Management's services purchasing managers index came in at 74.0, the highest level since July 2022.
Markets are pricing in about a 25% chance that the Federal Reserve will raise its benchmark interest rate in October. By December, they are fully pricing in one 25-basis-point increase.
JH Kim
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