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U.S. Treasury yields hit their highest level in more than two decades on Thursday as a global bond sell-off deepened.
The 10-year Treasury yield breached a level last seen in April 2002, rising 4 basis points to 5.3338%, according to LSEG data. The figure is key to rates for mortgage borrowing, auto loans and credit card debt.
The yield on the 30-year Treasury bond jumped 3 basis points to 5.6702%, its highest level since July 2002. The 2-year yield was 2 basis points higher at 4.91%.
Yields and prices move inversely. One basis point equals 0.01%.
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Government borrowing costs rose around the world on Thursday, continuing a months-long trend as investors express concerns over a lack of political action to tackle fiscal deficits, while inflation remains sticky and interest rates rise.
Major economies face “persistently large deficits and rising interest expenses — challenges long associated with debt-distressed emerging market sovereigns,” the Institute of International Finance said last week.
Japan’s 10-year yield was last seen at 3.126%, the highest level in three decades. Japan’s globally influential debt has come under pressure from a weaker yen and rate hikes by the Bank of Japan.
The yield on the German 10-year bund, the benchmark for the euro area, was up 4 basis points at 3.6179% — its highest since 2008. Elsewhere in Europe, the French 10-year popped 11 basis points to 4.9501%, Italy’s 10-year was up 10 basis points to 4.7171%, while the U.K.’s 10-year yield was up 5 basis points to 5.483%.
