US Treasury yields have climbed to their highest levels since 2002, with the benchmark 10-year Treasury note reaching a multi-decade high of 5.344% following a steep global bond sell-off on October 1. Heavy selling of government debt continued through Thursday and Friday, with the sell-off broadening into Europe.
The upward trend is being driven by persistent inflation, strong economic growth, and massive government borrowing. Other factors pushing yields higher include high government debt levels and the war in Iran, trends that are unlikely to dissipate soon and are keeping interest-rate expectations elevated.
These high yields risk slowing the economy by making it more expensive to borrow money, while simultaneously undercutting prices for stocks and other investments. Investors remain on alert as they await a key jobs report.