Long-Term Treasury Yields Hit 22-Year High

Bond yields, which drive borrowing costs, just brushed up against territory not seen since George W. Bush's first term. The yield on the 30-year Treasury briefly climbed to about 5.44% on Thursday, its highest level since 2004, before easing slightly. The 10-year yield, a key driver of mortgage rates, hit levels last seen in 2007, while shorter-term notes also hovered near recent peaks, CNBC reports.

The latest spike followed stronger-than-expected economic data, rising oil prices, and fresh signals from Federal Reserve officials that more rate hikes are likely, with markets now betting heavily on another move at the October meeting. "The combination of fiscal, economic, geopolitical, and supply-side inflation pressures converging has bond markets in less familiar territory. The recent rise in yields can no longer be attributed simply to concerns over the deficit," says Mike Sanders at Madison Investments.

The Wall Street Journal describes Wednesday as a "perfect storm" for the bond market, with the 10-year Treasury yield rising the most in a single session since Trump rolled out his "Liberation Day" tariffs in April last year. Global bonds slid in tandem, pushing Japan's 10-year yield to its highest level since 1996 and lifting key European benchmarks as investors reassessed how long high rates—and inflation pressures—might stick around.