Surge in 'risk-free' treasury yields sends bond investors in search of better opportunities
Key takeaways
- Livestream Menu Make Itselect USAINTLLivestream Search quotes, news & videos Livestream Watchlist SIGN INCreate free account Markets Business Investing Tech Politics Video Watchlist Investing Club PROLivestream Menu
- U.S. treasury bonds typically occupy a special place in an investor's portfolio — the asset class against which all other market risk is measured.
- The yield on the 10-year treasury recently surged to a level it had not seen in over a year, while the 30-year treasury yield this week hit a level it has not seen since 2007 — right before the financial crisis.
Livestream Menu Make Itselect USAINTLLivestream Search quotes, news & videos Livestream Watchlist SIGN INCreate free account Markets Business Investing Tech Politics Video Watchlist Investing Club PROLivestream Menu
U.S. treasury bonds typically occupy a special place in an investor's portfolio — the asset class against which all other market risk is measured. But a surge in long-dated yields is forcing investors to rethink this assumption.
The yield on the 10-year treasury recently surged to a level it had not seen in over a year, while the 30-year treasury yield this week hit a level it has not seen since 2007 — right before the financial crisis. The moves are being driven by geopolitical conflict and an oil price shock that have rekindled inflation and resulted in a growing consensus that the Federal Reserve will not lower rates at the next meeting, the first since new Fed Chairman Kevin Warsh was confirmed with a mandate from President Trump to bring rates down. In fact, traders are now betting there will be no interest rate cut over the remainder of 2026, and that a rate hike is becoming more likely. Warsh was being sworn in by Trump on Friday.