US Treasury Yield Hits Three-Year High Amid Inflation Concerns
The US Treasury yield has reached a three-year high of over 4.8% on the 10-year note, surpassing levels last seen in October 2023.
This increase is attributed to higher energy prices, which have already impacted gauges of underlying inflation and driven calls for interest rate hikes by Federal Reserve members, including Chairman Warsh, who noted that a rate hike may be warranted if inflation increases further.
The ongoing war in the Middle East has also escalated, with Iranian forces continuing to attack US forces, leading to concerns about fuel prices and supply disruptions.
Additionally, estimates of $1.5 trillion in debt raised by AI companies this year have limited primary dealers' allocation for government securities, further contributing to the rise in yields.