The 10-year US Treasury yield has reached its highest level in almost two decades, touching 5.02% on Tuesday, September 15, 2026. This surge marks a significant milestone in a global bond selloff. The last time the yield was at this level was in 2007, and it briefly breached 5% in October 2023. The latest increase followed a rise in global oil prices, exacerbated by growing risks to Middle East supplies.
This ascent of the 10-year yield is primarily attributed to a combination of factors: surging energy prices, escalating government and corporate debt, and persistent inflation concerns. The increased yield translates to higher borrowing costs across the board for Americans looking to finance homes or cars, as well as for businesses and the US government itself. Treasury Secretary Scott Bessent's efforts to calm the bond market have not been able to halt this upward trend.
The broader bond market, particularly the nearly $32 trillion US Treasury market, has been in a state of turmoil. Investors are grappling with multiple concerns, including soaring energy prices, the expectation of central banks raising interest rates, uncertainties surrounding the war with Iran, and unchecked government spending contributing to mounting debt. The Federal Reserve is widely expected to raise interest rates, with a 93% probability priced in by Fed funds futures traders for a hike at the conclusion of their two-day meeting this week. Some policymakers may even anticipate an additional rate hike this year, as indicated by their June projections.
