US Treasury Yield Hits 5% as Fed Policy Meeting Looms

The US Treasury yield hit 5% for the first time since October 2023 as investors await the Federal Reserve's policy meeting this week. The milestone marks a psychological threshold that could impact the US economy and threaten the bull market in stocks.

According to Molly Brooks, U.S. rates strategist at TD Securities, holding below 5% would signal investor demand, while surpassing it would indicate investors are worried about the long end and may see rates move even higher from here.

The yield curve between 2- and 10-year notes flattened to 33 basis points, and real yields on 10-year notes reached 2.622%, the highest since 2008.