US Treasury Yield Hits 24-Year High Amid Inflation Fears

The US 30-year Treasury yield has risen to its highest level since 2002, reaching 5.61% on Tuesday (Sep 29). This marks a sixth consecutive day of increases in yields for the longest-dated bond.

Michael Cloherty, head of US interest rate strategy at CIBC Capital Markets, notes that the long end of the market seems cheap by historical standards, but says 'we have yet to see the big value buyer up here.'

The leg higher in yields is attributed to inflationary angst and a large corporate debt supply. The US$32 trillion Treasuries market has been experiencing a months-long slide due to elevated oil prices tied to the war in the Middle East.

Comments from John Williams, president of the Federal Reserve Bank of New York, moderated expectations of further rate increases by the central bank. However, wagers on an October rate hike are likely to remain intact until Friday's release of the monthly US employment report for September.