18.08.202613:11:22UTC+00US 10-Year Yield Rises to 20-Month High

The yield on the 10-year US Treasury note climbed toward 4.75% on Tuesday, its highest level in 20 months, as mounting credit supply and the risk of more persistent inflation deepened investors’ aversion to longer-dated bonds. Corporate debt issuance in the US moved into sharper focus, with estimates suggesting AI-related companies alone could issue as much as $1.5 trillion in bonds this year. The surge in dollar-denominated fixed-income assets has amplified worries about accelerating deficit spending in the US and across other G10 economies, prompting higher estimates for term premia in global bond markets.

At the same time, oil prices extended their gains after President Trump indicated there was no urgency to lift the blockade on Iranian tankers in the Persian Gulf. Higher energy costs had already contributed to stronger underlying inflation this year, adding pressure on Treasuries. Concerns over inflation complacency were further stoked by Fed Chairman Warsh, who remarked that raising interest rates might not be his preferred instrument for tackling inflation.