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Oil jump pushes US 30-year Treasury yields to 20-year high
The 10-year yield rose to 5.196%, its highest level since 2007, as crude climbed about 3% after a Houthi missile attack on Saudi Arabia.
Bond markets faced fresh pressure as US 30-year Treasury yields hit a more than 20-year high, Reuters reported on Thursday. The move came as rising oil prices revived concerns about higher inflation and the potential for more Federal Reserve interest rate hikes.
Oil climbed about 3% to a one-week high after a Houthi missile attack on Saudi Arabia boosted fears of supply disruptions. Trade remained volatile and prices later eased from session highs after reports the US and Iran discussed reopening the Strait of Hormuz.
The yield on benchmark US 10-year notes rose 8.17 basis points to 5.196%, the highest since 2007, while the 30-year yield gained 7.96 basis points to 5.4816%, the highest since 2004. Gennadiy Goldberg of TD Securities said the higher yields reflected a mix of rising Fed hike expectations, higher growth expectations, higher oil prices, fiscal concerns, and increased issuance.
Goldberg also pointed to investor positioning as a factor behind a sharp rise in rates during the week. The article added that the yield gap between French and German 10-year debt widened to its broadest level since Mario Dragh.