US Treasury Yields Hit 18-Year High as Fed Holds Rates Steady

US Treasury yields have surged to their highest level since 2007, hitting 5.20% on the 30-year yield. This marks a significant increase in borrowing costs, which is expected to impact various sectors, including mortgages and credit cards.

The Federal Reserve held interest rates steady at 3.50%-3.75%, despite three dissenting members who favored a rate hike. Fed Chair Kevin Warsh has signaled a shift away from forward guidance, telling investors to trust market signals over central bank commentary.

Warsh's approach is seen as a move towards letting markets set the pace themselves, rather than relying on direct signals from the Fed. This change in policy comes as US inflation remains near 4%, well above the Fed's 2% target.