US Treasury Yields Soar to 19-Year High Amid US-Iran Conflict
US Treasury yields have reached their highest level in 19 years as investors worry about the escalating US-Iran conflict and its impact on oil prices. The yield on the 30-year bond touched 5.321% on Tuesday, while the 10-year note rose to 4.729%. This increase is attributed to a combination of factors, including competition for capital from AI hyperscalers, rising US budget deficits, and the Federal Reserve's opaque policy stance under Chairman Kevin Warsh.
Vasu Menon, managing director of investment strategy at OCBC, emphasized that bond investors should focus on shorter duration bonds to manage the risk associated with rising long-term yields. Menon noted that this trend is a warning sign for investors, who must be prepared for potential market volatility.