The US 10-year Treasury yield, a benchmark for mortgage and auto loan rates, climbed one basis point to 4.81%, its highest level since November 2023, as rising crude oil prices increased expectations that the Federal Reserve and other central banks could raise interest rates.
Meanwhile, the yield on the US 30-year Treasury bond climbed back to levels seen just before Treasury Secretary Scott Bessent expanded a buyback programme in an effort to contain long-term borrowing costs.
Investors are selling Treasuries as they demand greater compensation for inflation risks and rising government debt levels, while renewed tensions in the Middle East have added to price pressures.
The US and Iran exchanged strikes for the first time in about a month after American forces hit an island in the Strait of Hormuz, with the Islamic Republic responding by launching attacks on US military sites in Gulf nations.
Fighting between the US and Iran has intensified since the weekend after the American military reportedly struck Iranian rocket launchers on an island in the Strait of Hormuz, saying Iran was planning to use them to deploy mines into the strategically important waterway.
Iran retaliated by firing missiles at American bases in United Arab Emirates and Jordan, which were all intercepted. Tensions escalated further on Wednesday following the latest US attacks, while President Donald Trump threatened a significantly larger response should Tehran retaliate.
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