US Bond Market Selloff Drives Borrowing Costs to 22-Year High

A global selloff in government bonds has pushed US long-term borrowing costs to their highest level since 2004, as strong economic growth and rising energy prices put pressure on bond markets.

The yield on the 30-year UST climbed to near 5.50 percent, while the benchmark 10-year yield stood at 5.17 percent. Bond yields rise when prices fall.

The selloff accelerated after US business activity data indicated strong growth and rising inflation pressures, prompting investors to increase bets on further Federal Reserve interest rate hikes.

Higher borrowing costs are affecting consumers, with US 30-year mortgage rates now around seven percent, close to their highest level in two years.