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U.S. Treasury yields climb again as Fed expectations and supply pressure rise
The 10-year yield moved to about 4.80%, and the 30-year stayed near a two-decade high around 5.25%, even after Treasury Secretary Scott Bessent outlined added purchases to support longer-dated trading.
U.S. Treasury yields climbed again in recent weeks as markets re-priced expectations for how long the Federal Reserve will keep policy restrictive and demanded more compensation to hold longer-dated debt, according to Action Forex. The renewed upward pressure came as geopolitical uncertainty and stronger inflation inputs returned to the forefront, with oil prices jumping back above US$90 per barrel after a ceasefire in the Middle East dissolved. Action Forex also cited mostly strong U.S. economic data, including payroll gains rebounding sharply in August, alongside a hawkish Jackson Hole speech by Fed Chair Warsh that dismissed softer core inflation readings as unconvincing.
Yields were rising across the curve, with the 10-year Treasury yield moving from roughly 4.65% to 4.70% earlier in August to around 4.80%, its highest level since 2023. The 30-year yield remained near a two-decade high of about 5.25%, while the 2-year tenor gained an additional 20 basis points to above 4.35%.
Action Forex said markets are also bracing for a period of increased Treasury and corporate issuance as the calendar turns to autumn. The report noted that Treasury Secretary Scott Bessent announced late-August steps to increase purchases intended to support trading in longer-dated bonds, while leaving regular borrowing unchanged, though any relief appeared modest and short-lived as 30-year yields continued to rise in late August and September.